Free-to-air satellite television provider Openview now boasts more than 1.5 million activations, according to eMedia Holdings, which holds a 67.7% stake in Openview parent eMedia Investments.
EMedia Holdings disclosed in its annual results for the year ended 31 March 2019, published on Thursday, that Openview — a sister company to e.tv and news channel eNCA — that despite the strong growth, Openview remains loss making.
Openview (inclusive of the e.tv multi-channel business) earned advertising revenue of R131.8-million and incurred content costs of R255.7-million, up from R173.6-million in 2018, it said.
The increase is attributable to the launch of Open News — a new free-to-air news channel — as well as the addition of an Afrikaans block on eExtra and the launch of eReality in November.
“These content changes have increased the market share on other eChannels from 2.6% in March 2018 to 4.6% in March 2019,” eMedia Holdings said. “Operating costs, including retail subsidies of R55.3-million, amounted to R185.4-million compared to R193.6-million in the prior year.”
The reduction is mainly due to the reduction in subsidy from R150 to R75 per set-top box in October as well as the exit from the company’s contract with satellite provider SES.
“Despite the reduction in subsidy, Openview set-top box activations continue to grow at an average of 35 000/month. At the end of the period, a total of 1.57 million (2018: 1.15 million) boxes have been activated and a total of R55.3-million (2018: R74.5-million) has been spent on retail subsidies.”
During the year, Openview launched personal video recorder functionality in its set-top box and plans “a few more technical initiatives” this year.
Group-wide, eMedia Holdings reported a 4% improvement in advertising revenue to just over R1.6-billion. This was “in some way assisted” by the increase in market share of the group from 18.1% in March 2018 to 24.1% in March 2019.
Cost of sales, which mainly consists of the cost of content in the case of e.tv and employee costs in the case of eNCA, increased by 1% at R1.2-billion. Administrative and other expenses declined by 0.9% year on year.
“While the group continues to invest in the Openview platform, which remains loss making, the above factors contributed to the turnaround in profits,” it said. The group ended the year with a profit from continuing operations of R117.6-million, compared to a loss in 2018 of R1.6-billion (which included the impairment of goodwill of R1.5-billion). – © 2019 NewsCentral Media