MEDIA24 owners, Naspers, and its Netherland subsidiary Prosus’s share prices surged after they said a complex cross-holding structure between them would be removed, in spite of Naspers reporting a sharp loss for the year to 31 March.
Naspers, which owns Takealot.com and Media24 in South Africa, reported a 48% decline in core headline earnings to US$$1,1 billion (N$20,3 billion), a decrease of 48% or US$1 billion primarily due to lower contributions from the group’s associates (US$1,3 billion), of which US$1,1 billion related to Tencent.
Naspers’ biggest investment, the China-based internet giant Tencent was hit by Covid-19 lockdowns in China and geopolitical and macroeconomic uncertainty, and losses by its e-Commerce businesses.
Naspers’ share price surged 9,27% to N$3 276,16 and the Prosus share price had gained 8,49% to N$1 394,69 by early yesterday afternoon on the Johannesburg Stock Exchange.
Naspers group trading profit declined by 32% to US$3,3 billion (N$61 billion), reflecting Tencent’s lower contribution and an increase in the group’s share of losses from e-Commerce associates.
Prosus’s operating loss widened to US$1,34 billion (R20,96 billion) from US$950 million (N$17,56 billion). Prosus holds Naspers’ former international investments with stakes in Tencent, Trip.com, Delivery Hero and financial technology company PayU, among a host of other companies.
Naspers’s revenue increased to US$6,8 billion (N$125,6 billion) from US$6,3 billion.
Operating losses increased to US$1,4 billion (N$25,9 billion) from US$985 million (N$18,1billion). Core headline earnings per share fell 27,9% to 507 US cents from 703 US cents.
“E-Commerce consolidated trading losses from continuing operations of US$639 million reflected incremental investment in the group’s e-commerce growth extensions as we continued to invest in high-conviction growth areas,” Naspers directors said. “To counter the deterioration, costs were cut, including a 30% reduction in workforce costs.”
The directors added that the profitability of the e-Commerce businesses had improved in the second half.
The group has previously said it would bring its e-Commerce businesses to profitability in the first half of the 2025 financial year. – IOL News
