MULTICHOICE POSTS LOSS ON DROP IN SUBSCRIBERS
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MultiChoice, the largest TV firm in South Africa, reported a pretax loss of 706 million rand ($38 million) for the year that ended in March, the company said on Wednesday. Weak local currencies and a decline in customers were the reasons given.
France’s Canal+ is putting in a buyout attempt for the business; it now owns more than 35% of MultiChoice’s shares.
“Volatile and weaker local currencies, power challenges in markets like South Africa, and a weak consumer environment due to rising inflation and high interest rates have created an extremely challenging environment,” MultiChoice said.
The previous year’s 921 million rand profit before taxes was followed by the loss.
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A nine percent drop in subscribers made it worse.
According to the report, 275 days of continuous power outages hurt business in South Africa and turned off prospective customers who didn’t have backup power.
Group revenue decreased by 5% to 56 billion rand, but the company claimed that it would have increased by 3% if not for fluctuations in foreign exchange rates.
The biggest pay TV company in Africa announced that it will expedite a cost-cutting initiative, give priority to keeping customers, take advantage of sports renewals, and expand its local content offerings.
The company reported that its Showmax video streaming business, which saw a relaunch in February, was exhibiting “encouraging early traction,” with a 16 percent growth in paying subscribers.
A firm offer was made in April to buy all of the MultiChoice shares that Canal+, the billionaire Vincent Bollore’s branch of Vivendi, currently does not own.
An independent board appointed by the South African corporation deemed its previous offer, which was rejected, to be “fair and reasonable,” and so it boosted it to 125 rand per share.
The French company claims that Canal+ has eight million subscribers and is accessible in 25 African countries via 16 subsidiaries.
Due to its ownership of MultiChoice, the largest pay TV provider in Africa, they have access to markets in nations where the languages of both English and Portuguese are spoken.
AFP
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