South Africa media and ecommerce giant Naspers has announced that its revenues from ecommerce activities increased 64% to R20,3bn, driven by etail concentration in various markets, said the firm in its financial results for the year ended 31 March 2014.
“As this is an area of expansion, development spend rose as we scaled operations, increased the number of focus markets in classifieds and strengthened our talent pool. Consequently the trading loss widened to R5,3bn,” said Basil Sgourdos, new CFO of the group.
Naspers runs OLX, Property24, Kalahari, Multichoice, PriceCheck among others says it saw improving profitability from the Allegro marketplace business and some classifieds and online price-comparison operations. Several classifieds markets evidenced growth ahead of competitors announced the firm.
Naspers consolidated revenue grew a robust 26% to R62,7bn, driven by both internet and pay-television businesses, driven mostly by its development spend, which accelerated 79% to R7,7bn says the report.
This step-up limited core headline earnings, considered by the board to be an indication of sustainable earnings performance, to R8,6bn, marginally higher than last year. Core headline earnings per share amounted to R21,81 and a dividend increase of 10% to R4,25 per share has been proposed.
“Our established businesses performed very well and we stepped up our investment in new growth opportunities, particularly in ecommerce.”
“We had a lively year with progress across several businesses,” said Naspers chair, Ton Vosloo. “Our established businesses performed very well and we stepped up our investment in new growth opportunities, particularly in ecommerce.”
The pay television business in over 50 countries in Africa reported 20% growth in revenues to R36,3bn. Total subscribers increased by a record 1,3 million, taking the base to over 8 million homes. Continued expansion of digital terrestrial (DTT) services, more investment in local content and an increase in online service offerings resulted in 13% growth in trading profit to R8,5bn. The firm’s print media arm was the most hard hit with flat revenues were flat and decining margins.
However, the firm gain from earnings from Tencent in China and Mail.ru Group in Russia, which increased by 46% to R10,2bn.
In a statement Naspers CEO Bob van Dijk said, “Our goal is to invest in growth businesses that will deliver value over the long term. With this in mind, we will continue to invest heavily for organic expansion and may also acquire new businesses within our fields of focus.
Dijk said the firm believes that through a combination of attractive markets with development potential and appealing customer product offerings such as online classifieds, etail and DTT, it has realistic, solid prospects for growth and value creation over time.
Recently, MIH Africa CEO Bill Paladino left the firm, and the group shut down a number of e-commerce sites to focus on the general e-tail businesses such as Kalahari. but this perfomance shows the firm is increasing its investments in ecormmece and classifieds around the world.