MultiChoice, hit by declining subscribers, announces a $225m loss, citing forex challenges.
MultiChoice, affected by a decline in subscribers, has reported a total annual revenue loss of $217 million. The company attributed the loss to macroeconomic challenges and forex issues, prompting shareholders to consider potential relief through Canal+ ownership acquisition.
Devaluation and inflation in key markets like Nigeria and Ghana decreased consumer purchasing power, resulting in a drop in active subscribers. In Nigeria, active subscribers decreased by 1.2 million to 8.1 million, reducing the country’s revenue contribution to the Rest of Africa segment from 44% to 35%.
MultiChoice, Africa’s largest pay television company, is awaiting acquisition by Canal+, which has made a cash offer of $6.78 per MultiChoice share, totalling about $1.9 billion. The offer is expected to close by April 2025.
Recent results show a decrease in premium customers, including those on the Premium and Compact Plus packages, by 8% in all markets. The mass market also saw a 2% decline despite cost-saving measures such as reducing decoder subsidies and achieving savings of $103 million.
Due to volatility in the foreign exchange market, the company also suffered remittance losses totalling $59 million from Nigeria.
Currency depreciation against the US dollar in several markets impacted reported trading profit by 4.3 billion rands ($233.11 million), including 158 million Kenyan shillings ($8.57 million) and 3.3 billion South African rands ($178.9 million) on a 50% decline in the official Nigerian naira.
Inflation challenges in some markets outside South Africa led to subscription cancellations. The “rest of Africa” business saw a 13% fall in subscriber numbers year on year, with the worst performances.
MultiChoice's streaming platform Showmax posted higher revenue but also increased losses for its latest fiscal year, which ended in March, due to investments related to its recent relaunch, including additional entertainment packages and an enhanced viewer experience.
MultiChoice serves 23.5 million customers in 50 markets across sub-Saharan Africa. In addition to its DStv, Showmax, SuperSport, and MNet media companies, MultiChoice offers medical and security services (Namola), cybersecurity (Irdeto), and sports betting (Betking).
An independent board, reviewed by Standard Bank, stated that France’s Canal+ offer to buy the shares it does not own in South Africa’s MultiChoice is fair and reasonable.
Additional information from MultiChoice.
