Multichoice, the operator of DStv and GOtv, has reported a loss of 4.1 billion rand, an equivalent of ($225.8 million at current exchange rate).
This was revealed in Multichoice’s financial report, for which the year ended on March 31, 2024.
The company recorded a loss for the second year running, its audited accounts released showed.
According to MultiChoice, the net foreign exchange translation losses resulted from losses on “USD-denominated non-quasi equity loans between MultiChoice Africa Holdings B.V. and MultiChoice Nigeria Limited.”
This, it added, “follows the depreciation of the naira against dollar from a closing rate of N464.50 in FY23 to N1 308.00 in FY24.”
According to the income statement, revenue dropped 5.9% to 55 billion rands due to a slide in subscription fees.
“The combination of foreign exchange headwinds and a lower subscriber base resulted in a net decline in group revenues of 5% to ZAR56.0 billion,” MultiChoice pointed out.
General and administrative expenses jumped to 18.4 billion rands from 16.6 billion rands a year earlier after surges in employee costs and software license expenses, weakening operating profit.
However, Multichoice’s diversification strategy has led to significant growth in other segments, such as; Showmax, SuperSportBet, and Moment. These new revenue streams have contributed to the company’s overall performance, offsetting some of the challenges faced by DStv.
According to the financial results, several of the company’s other products and services also performed well. Showmax, in particular, has shown impressive growth, with a successful relaunch across 44 markets in sub-Saharan Africa and a significant increase in active users.
Contrary to popular belief, Multichoice’s financial results have revealed that the company is not making enormous profits from its DStv satellite television service.
While the company has shown resilience in a challenging economic environment, its financial performance indicates a different story.
Highlighting the company’s achievements in the face of adversity, Multichoice Group Chief Executive Officer, CEO, Calvo Mawela, said despite a tough year, the company delivered a trading profit margin of 26% in South Africa and a 48% increase in trading profit in Africa.
“We’ve just published our results for the past financial year, which ended in March 2024. The year has been like no other in terms of economic turmoil, but we showed resilience and navigated significant headwinds – managing our business with focus, dedication, and tenacity”, said Mawela.
He added that the company’s financial results were a testament to its ability to adapt and innovate in a rapidly changing market, noting that the emphasis on efficiency has positioned the company for future growth, despite the challenges faced by its satellite television service.
“KingMakers delivered strong growth in the online business in Nigeria by growing monthly active online users by 37% and online gross gaming revenues by 26%, year-on-year in constant currency. The business launched BetKing Casino and a virtual football sportsbook service, BetKing FootballGO, in Nigeria and SuperSportBet in South Africa”, the CEO stated.
According to him, “SuperSport continues to bring fans the best of sports from across the globe. In the past year, we broadcast over 34,000 action-packed sports events, more live sports than any other broadcaster in the world. Highlights of the year were the Rugby World Cup, Cricket World Cup, Netball World Cup, FIFA Women’s World Cup and AFCON.
“Also, SuperSport Schools continues to grow strongly and more than doubled its registered user base during the year. Showcasing South Africa’s talent of the future, the platform displayed 49,000 hours of live programming across 43 different sports, covering 1,100 schools and 14,500 teams.”
Mawela emphasized the company’s dedication to creating authentic African stories. “We are the largest producer of original content on the African continent and remain committed to creating and growing authentic African stories.
We produced over 6,500 hours of local content, to bring our local content library to 84,000 hours of content. More than half of our general entertainment budget is spent on local content.”
With a cost savings target of ZAR2 billion (108.9 million) set for the upcoming year, the company is set to continue its trajectory of growth and innovation.
“We know that nobody else has the content we have for the customers we serve. This puts us in a great position to prosper – by better understanding our customers’ entertainment choices, identifying their needs and tapping into the growth opportunities that arise along the way.
“In the year ahead, our focus will be to drive scale in Showmax, Moment, and SuperSportBet and to grow DStv Insurance, DStv Internet and DStv Stream. We are purposefully pursuing our vision of becoming Africa’s entertainment platform of choice with determination and vigour. Significant progress has been made towards achieving this strategic objective.
Our combined efforts will put our business in a strong position to prosper once the macro-economic environment stabilizes”, the Multichoice boss assured.
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