MultiChoice ‘shrugs off’ R4.1bn loss
MULTICHOICE has reported an R4.1 billion loss for the year ending March 31, as it has become technically insolvent.
The group reported a 30% drop in full-year operating profit. The company said it was hit by inflationary pricing across its markets, constrained consumer spending, and currency volatility.
“Group revenue increased by 3% on an organic basis. However, due to weaker local currencies and consumer pressure, reported group revenue declined by 5% to R56bn,” MultiChoice said.
Active subscribers declined by 9% to 15.68 million. The company said this was mainly due to a 13% decline in the rest of African businesses, with Nigeria, Angola and Zambia most affected. MultiChoice said its SA business was more resilient, declining by only 5%,” it said.
MultiChoice’s total assets have decreased from R47.6bn to R43.9bn and its liabilities have grown to about R45bn. The negative equity of R1.068bn may force the company to sell some of its assets to settle its debt obligations.
The group, despite these disastrous figures, said that it’s operational performance was “resilient” and noted that it was on a turnaround.
The group said it would prioritise creating more cash and push its cost-reduction programme into overdrive. “While we are not alone in feeling the challenges … I am proud of the speed and effectiveness of the team in implementing strategic actions to retain customers, safeguard cash generation and drive costs savings which surpassed our targets,” Calvo Mawela, MultiChoice Group CEO said.