R294bn bonanza for Naspers, Prosus

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Bob van Dijk, group CEO, Prosus and Naspers.
Bob van Dijk, group CEO, Prosus and Naspers.

Naspers and its new Internet business unit Prosus have reported combined revenue of $20.1 billion (R294.6 billion).

The companies announced their interim results for the six months ended 30 September on Friday.

The JSE-listed Naspers’s revenue increased 20% to $10.2 billion (HY19: $9.1 billion). Trading profit grew 9% to $1.9 billion (HY19: $1.8bn), while core headline earnings grew 10% to $1.7 billion (HY19: US$1.5 billion).

Prosus, which listed on the Euronext Amsterdam on 11 September, reported a revenue increase of 20% to $9.9 billion (HY19: US$8.9 billion).

The company, which has a secondary listing on the JSE and is 74% owned by Naspers, also said trading profit grew 7% to $1.9 billion (HY19: $1.8 billion). Its core headline earnings grew 10% to $1.7 billion (HY19: $1.6 billion).

Commenting on the results, Basil Sgourdos, group chief financial officer, says: “We executed well during the first six months of the year, growing revenue 20% to $10.2 billion, and trading profit 9% to $1.9 billion.

According to Sgourdos, all key segments made good progress against financial and strategic objectives.

He notes the classifieds as well as payments and fintech segments reached profitability at their core and continue to grow strongly, while investing to drive future growth.

“Food delivery remains the largest investment area for the group this year, underscoring our confidence in the strong underlying unit economics of this business. We end the period with a strong net cash position of $5.9 billion, which positions us well to pursue further growth.”

Bob van Dijk, group chief executive, adds: “We entered FY20 well-positioned as a global consumer Internet group following the successful listing and unbundling of MultiChoice Group.

“In the first six months, we successfully listed our international Internet assets as Prosus on Euronext Amsterdam in September, creating Europe’s largest consumer Internet company by asset value and unlocking $10 billion in value for our shareholders.

“The listing of Prosus positions us well for future growth, opening up investor access to our unique portfolio of international Internet assets. For the six months ended 30 September, we delivered solid results and good progress in our core segments, which are growing fast and scaling well.”

Koos Bekker, Naspers chairman, comments: “The team delivered a solid performance. While growing revenues, trading profits and core headline earnings, we took several steps to build a global business with long-term growth.

“In South Africa, the appointment of Phuthi Mahanyele-Dabengwa as CEO underlines the group’s continued commitment. Our Naspers Labs and Naspers Foundry aim to tackle youth unemployment and support the development of the local entrepreneurial ecosystem.”

Launched in 2019, Naspers Foundry funds and develops talented and ambitious entrepreneurs in SA. These entrepreneurs typically use technology to build companies that improve people’s lives, the company says.

To date, Naspers has invested R30 million in one deal with SweepSouth, an online cleaning services platform that connects clients with domestic cleaners.

The Foundry team has reviewed around 350 applications to date and met with more than 50 companies and their founders.

“We have a strong pipeline of deals and plan to invest substantially in the next three months,” says Naspers.

To help address unemployment in impoverished communities, social impact programme Naspers Labs was launched in 2019.

According to Naspers, the idea is to help young, unemployed South Africans aged between 17 and 25 by opening doors to their first economic opportunity.

Located in low income, urban settings, the Naspers Labs provide a structured development journey, enabling young people to tap into online learning platforms.

On 22 October, Prosus announced the terms of a cash offer to acquire food delivery company Just Eat. On 11 November, the company published its offer document. Under the terms of the offer, Just Eat shareholders will be entitled to receive 710 pence in cash for each Just Eat share.

The closing date of the offer is 1.00pm (London time) on 11 December, unless extended by Prosus.

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