/ 30 November 2010

Naspers profits up by a third

Emerging markets media conglomerate Naspers posted a 33% rise in first-half earnings on Tuesday, helped by strong performance of its pay-TV and internet units, but cautioned that full-year profit could be hit by the increasing cost of sport on television.

The South African company, which has a market value of $21,2-billion, said core headline earnings per share totalled 860 cents for the six months to end-September compared with 648 cents in the same period a year earlier, at a top end of its own forecasts for an increase of between 25 to 35%.

Naspers, Africa’s largest media group, considers core headline EPS as the best gauge of its earnings. The measure excludes one-off and non-operating items.

While other media companies have been battered by the recession and a decline in traditional advertising revenue, Naspers has thrived due to investments in internet companies and pay television, particularly in fast-growing emerging markets.

The company said revenue rose 18% to R15,8-billion in the first half.

Revenue at its flagship pay-TV unit Multichoice, home to SuperSport and M-Net, rose 20% to R10,2-billion, helped by an increase of 498 000 new customers to 5,4-million subscribers, boosted by the World Cup.

The internet business grew its revenue by 54% to R5,5-billion, boosted by the contribution of Tencent, China’s biggest internet company by market value.

Naspers also owns a 29% stake in Russia’s Digital Sky Technologies, which owns Mail.ru, the internet firm listed on the London Stock Exchange earlier this month.

Naspers, which also has operations in Central and Eastern Europe, China, Russia, Latin America, Africa, India, Thailand and the United States, said it expected full-year revenue to remain healthy.

Shares in Naspers have risen 22% this year, outperforming a 9% increase in the Johannesburg’s Top-40 index. — Reuters