Pay-TV giant MultiChoice Group reported a significant 99% decline in half-year profit, citing an “extremely hostile” operating environment. The company, which operates DStv across 50 sub-Saharan African countries, faced challenges from weakening local currencies, constrained consumer spending, especially in Nigeria, and severe power outages in Zambia.
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MultiChoice’s adjusted core headline earnings per share plummeted to 2 cents, a drastic fall from R3.56 a year prior. Although group revenue increased organically by 4%, reported revenue declined by 10% due to foreign exchange fluctuations and mergers and acquisitions.
The company experienced a 5% and 15% decrease in subscriptions in South Africa and the Rest of Africa, respectively. MultiChoice’s investment in streaming platform Showmax, aimed at competing with global giants like Netflix, Amazon, and Disney, further impacted profitability.
Despite these challenges, MultiChoice highlighted that, excluding Showmax, the group would have seen a 28% organic increase in trading profit. As of 2:12 PM, MultiChoice shares were down 0.3%.
