South African pay television company MultiChoice Group reported a 99% fall in half-year profit earlier this week and described the operating environment as “extremely hostile”.
The owner of DStv, whose pay-TV business operates in 50 countries in sub-Saharan Africa, said its performance was marred by weaker local currencies, constrained consumer spending, particularly in Nigeria, and extreme power disruptions in Zambia.
Multichoice said its adjusted core headline earnings per share – its measure of the underlying performance – fell to 2 cents per share for the six months ended Sept. 30, down from 356 cents per share a year earlier.
Overall group revenue at Multichoice fell by 10% US$1.41 billion on a reported basis but grew by 4% on an organic basis, which excludes the impact of foreign exchange effects and mergers and acquisitions.
Multichoice said subscriptions fell by 5% and 15%, respectively, in its South African and Rest of Africa operations.
It said incremental investments further hit profit in streaming platform Showmax, which Multichoice prioritises to fight off competition from streaming giants Netflix, Amazon and Disney.
“Stripping out Showmax, the group would have seen reported trading profit increase by 28% on an organic basis,” said Multichoice, whose shares were down 0.3% at 1212 GMT.
