MIH Holdings increased its earnings before interest, taxation, depreciation and amortisation (EBITDA) by 291.6% in its latest financial year, although its headline loss per share increased by 13%.
The group has reported a headline loss of 198.71c for the year to 31 March 2002, compared with a 175.84c headline loss per share the previous year.
<B>Salient figures</B>
MIH Holdings results for the year to 31 March 2002
Previous year`s figures in parentheses:
Revenue: R6.22b (R5.01b)
EBITDA: R419m (R107m)
Depreciation: R430m (R277m)
Amortisation: R309m (R32m)
Profit before tax: -R549m (R239m)
Profit after tax: -R595m (R136m)
Net profit: -R2.24b (R1.48b)
HEPS: -198.71c (-175.84c)
NAV per share: 379.67c (953.63c)
Current assets: R5.13b (R4.5b)
Current liabilities: R4.42b (R2.89b)
Net cash used in operating activities: R55m (R597m)
The EBITDA rise was mainly because of a 54% improvement in EBITDA from the television subscriber platforms and a 45% reduction of the EBITDA losses from the Internet operations.
"We have achieved EBITDA of $49 million this year by scaling businesses to match revenues, by rigorous cost-cutting and by a focus on improving margins across our core subscriber platforms," says MIH Holdings CEO Cobus Stofberg.
"We are pleased with this result, which has beaten consensus among analysts by a wide margin."
Stofberg says the subscriber platforms continue to perform well despite difficult economic conditions and the strengthening of the dollar against the rand.
"Digital subscribers now make up 57% of the total subscriber base. The migration to higher margin digital services is also reflected in our improved results."
MultiChoice Africa`s aggregate subscriber base ended the year at 1.28 million households, with the digital base for Africa growing by 140 000 subscribers to 793 000, accounting for 62% of the total number of subscribers.
The group says the market in SA is now mature, and growth in revenues from digital subscribers was in part offset by the churn in analogue subscribers.
The analogue base in Greece declined to 165 000, although the digital base grew 45% to end the year with 100 000 subscribers.
"The launch of a competitor in Greece caused turbulence and confusion in the market as potential subscribers take a wait-and-see attitude," Stofberg says. "Some of the soccer clubs were induced to breach their contractual obligations with us and we have responded with the appropriate legal action."
Pressure on the Mediterranean business`s margins is expected to continue as the group defends its position there.
Commenting on the Internet operations, Stofberg says the group regards the Internet as an important media distribution platform.
M-Web Holdings, which was delisted from the JSE in July last year, ended the year with 247 000 dial-up subscribers and 2 600 hosted clients. During the year the group increased its interest in M-Web Africa from 22.3% to 41%.
"It continues to be the market leader despite the launch of a free Internet service which it has successfully beaten off.
"M-Web performed well. EBITDA losses at $11 million are now a third of what they were last year."
MIH chairman Ton Vosloo says the group is aiming to maintain its leadership position in its markets and to leverage its core competencies in subscriber platform management.
"In the year ahead we will focus on building shareholder value, scaling our businesses to deliver operational efficiencies through rigorous attention to cost-cutting and growing recurring subscription revenues and profitability across our core subscription businesses."
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