Advanced Television

Naspers issues profits warning

November 23, 2022

By Chris Forrester

South African multi-national Naspers, which backs the Netherlands-based Prosus media/broadcasting entities and the Media24 media group, has issued a profits warning, saying that it expects a “major decline” in its half-year position.

Naspers warned investors that headline earnings per share for its continuing operations would decline by between 100 per cent and 108 per cent from $3.51 to between -$0.28 and -$0.02.

Its core headline earnings looked a little better, but Naspers still projected a decline of 52.3 per cent to 59.7 per cent — from $3.94 to between $1.59 and $1.88 for continuing operations.

“Shareholders are reminded that the board considers core headline earnings an appropriate indicator of the operating performance of the group, as it adjusts for non-operational items,” Naspers stated.

The losses have not come from its key media assets but from Naspers stake in China’s Tencent. Naspers says its share of Tencent’s fair value losses on financial instruments of $372 million, compared to fair value gains of $1 billion in the prior period. The firm’s stake in Tencent, however, continues to dominate the results, and Tencent had contributed $2.1 billion of the firm’s $1.4 billion in core headline earnings from continuing operations in its 2022 year, amid losses elsewhere.

Naspers says that the worse of the bad news is behind it.

Naspers notified shareholders that it expects an 81 per cent to 88 per cent decrease in earnings per share from US$30.14 to between $3.52 and $5.64.

The company’s results reported a 41 per cent revenue growth in its e-commerce division.

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