South African media group Naspers on Tuesday reported a headline loss per share of 19 cents for the year ended March 31 2003 from a headline loss per share of 313 cents a year ago.
The headline earnings from continuing operations amounted to 1 cent per share from a headline loss of 162 cents a year ago. However, its core headline loss per share amounted to 63 cents from a loss of 120 cents a year ago.
The group proposed an ordinary dividend of 30 cents per N share, up from 25
cents a year ago. During the year Naspers sold its interest in OpenTV. The transaction was accounted for as a discontinuing operation and a profit of R751-million was recorded. The profit includes the release of foreign currency translation
reserves of R673-million, the group said.
Revenue was higher at R11,187-billion from R9,837-billion, while net income attributable to shareholders was R326-million from a loss of R1,923-billion a year ago.
Headline earnings from continuing operations amounted to R2-million from a loss of R236-million a year ago.
Naspers said that during the year the group focused on improving margins in
its established businesses and driving new ventures to profitability.
Relatively fewer new opportunities were developed. Most business units contributed well to improve the group’s earnings.
The group completed a re-organisation in terms of which the minority interests in MIH Holdings Limited (MIHH) and MIHL were swapped for shares in Naspers itself.
The process concluded with the secondary listing of Naspers on the Nasdaq.
Goodwill of R1,8-billion, as well as other intangible assets of half a billion rand, were created on the balance sheet.
Naspers said that conditions in most markets in which it operates remain tough. ”In this environment, our focus on improving margins in our mature businesses, and driving new ventures to profitability, resulted in operating profits before amortisation and impairment growing to R527-million,” it said.
The stronger rand resulted in favourable translation gains that reduced finance costs by R214-million.
”Whilst a firmer rand will be of benefit to our South African units which have foreign currency input costs, the group follows a policy of covering forward its expenses denominated in foreign currency, which will dampen the beneficial impact. In addition, the stronger local currency also resulted in our earnings from our offshore units translating into fewer rand,” it said.
The group grew its pay-television subscriber base by only 40 000 households during the year. The group now manages just over two million pay-television subscribers, of whom 67% are on the digital base. As a consequence, pay- television revenues increased by only 13%.
The internet was the group’s fastest growing business with revenues up by 63%, whilst operating losses before amortisation were almost halved to R244-million.
In Africa, M-Web maintained its leading position with 247 000 subscribers.
Most sectors of the South African magazine and newspaper markets are overtraded and the circulation of magazine titles generally remained under pressure. Media24 compensated for this by attention to content quality and cost reduction, the group said.
Exceptions are the Sunday Sun and Daily Sun titles, which were conceived to attract buyers who would otherwise not be regular readers of newspapers. Their formula of content written in a language that their readers find familiar, sold at a price they can afford, is proving popular.
In aggregate, print media revenues grew by 14% and operating profits by 8%.
The book publishing business had a poor year with revenues growing a meagre 3%. This, in addition to the liquidation of CNA and provisioning for stock write-downs, resulted in an operating loss before amortisation of R20-million. This business is being re-organised.
Educor had a satisfactory year, with modest revenue growth, but operating profits before amortisation growing by 69%. Student enrolments for the current academic year were up on the previous year on most campuses.
Looking ahead, Naspers said the year ahead may prove to be adventurous. On
the one hand, the South African economy appears in better shape than most,
whilst some other markets may start to recover.
On the other hand, the global geopolitical scene is unstable and great uncertainty surrounds the course the Sars epidemic will take. All of these factors may have fundamental economic consequences for Naspers’ markets.
”Against this background, it would be presumptuous to predict performance
for the year ahead. However, we are conscious that each set of economic circumstances offers some opportunities to those who seek them out and adapt fast enough,” it said. – I-Net Bridge