[ad_1]
DStv operator MultiChoice Group said in a financial report for the six months ending September 2020 that it surpassed the 20 million subscriber milestone for the first time.
The group added 1.2 million active 90-day subscribers year-on-year (YoY), to close the period at 20.1 million households. The customer base is divided between 11.4 million households (57%) in the rest of Africa (RoA) and 8.7 million (43%) in South Africa.
Core earnings were up 41% from the prior period at R2.7 billion, with strong growth attributable to a 38% improvement in organic trade earnings and lower realized net foreign exchange losses, it said.
Overall earnings per common share rose 68% to 572 cents per share, while operating earnings increased 17% to R5.77 billion.
The impact on business earnings from Covid-19 was largely neutral, as a R900 million revenue loss related to lower ad revenue and commercial customer subscription revenue was offset by R800 million in delayed content costs.
“Despite operating in a challenging environment and being affected by blackouts, production shutdowns and outages in live sport, we are meeting all key metrics,” said Calvo Mawela, CEO of MCG.
“A strong focus on cost reduction enabled another R1 billion in cost savings during the period. We also cut losses in the rest of Africa by 59% year-on-year to R338 million ”.
Revenues increased 2% (-1% organic) to R26.1 billion, with subscription revenue of R22.2 billion increasing 5% (3% organic) year over year.
Momentum from the top line was significantly affected by Covid-19, the group said. Advertising revenue decreased by R572 million year-on-year, mainly due to a lack of sports advertising and a generally weaker advertising market as a result of lower economic activity.
Excluding the impact of Covid-19, MultiChoice said that revenue would have grown 6% year-on-year.
The group said it continued its strategic focus of investing in local content and produced an additional 1,870 hours, despite disruptions caused by strict Covid-19 blocking measures. The local content library is now close to 59,000 hours.
On Thursday (November 12), the group announced the launch of DStv Explora Ultra, its next-generation set-top box. “As part of the new experience, Netflix will now be available for the first time on the Ultra set-top box, which will go on sale next week,” he said.
South Africa
MultiChoice said its business in South Africa delivered a ‘resilient performance’ in a difficult consumer climate, reporting subscriber growth of 7% YoY or 500,000 subscribers on a 90-day active basis.
The impact of Covid-19 and the associated lockdown caused consumers to prioritize video services, but the lack of live sports and the inability of commercial subscribers to trade negatively affected revenue generation, he said.
Revenues decreased 3% to R16.5 billion, affected by lower advertising and commercial subscriber revenues. Commercial profit increased 12% to R5.8 billion.
“This higher profitability can be attributed to the duplication of the group’s cost optimization program, the non-repetition of three important sporting events uploaded in the previous comparative period, lower operating costs in a Covid-19 environment and a temporary change in costs. of content as a result of delays in sporting events ”.
Going forward, MultiChoice said the group’s focus throughout the year, subject to a stable regulatory environment and potentially adverse consequences from Covid-19, will be to further scale its video entertainment platform across the continent, focusing on traditional streaming and transmission services. and increase your investment in local content.
Read: The government wants Netflix and Multichoice to collect TV licenses for SABC
[ad_2]
