MultiChoice reports first full-year profit

MultiChoice reported its first full-year profit as a stand-alone company on Wednesday, in the middle of a range it forecast last week.

The company, which serves 19.5 million households in 50 countries on the continent, was spun off by parent company Naspers last year, and initially struggled with losses in its operations outside its home market, South Africa.

But it said on Wednesday that during its first full-year since the split from Naspers, it had benefited from favourable foreign exchange movements, cut costs and improved the performance of its businesses elsewhere in Africa.

CEO Calvo Mawela said the company was pleased with its performance, but that it faced “unprecedented times”.

“Our healthy balance sheet positions us well to weather the uncertainties in our markets going forward,” he added.

The company said its headline earnings per share – the main profit measure in South Africa – stood at 128 cents ($0.0774) in the year to March 31.

That compares to a loss of 353 cents a year earlier, and a rise of between 107 cents and 147 cents it forecast last week.

Subscriber growth slowed slightly, to stand up 5% year-on-year. MultiChoice said consumers were increasingly under financial pressure in many markets and also cited drought-related electricity shortages in southern Africa and one-off sporting events that did not recur.

It reduced losses in its divisions outside South Africa by R800 million, and cut R1.4 billion in costs throughout the year, it said. Its board recommended a final dividend of 565 cents.

Its shares pared losses following the announcement and were trading 1% lower by 1201 GMT.