Supported by improved broadband penetration, MultiChoice expanded its connected video services in the six months ended September.
The pay-TV group reported its half-year results yesterday, saying users on the DStv app and Showmax continue to increase, as online consumption of its services is on the up.
In the six months, the year-on-year growth rate for paying Showmax subscribers was 50%, while the overall online user base increased by 13%.
MultiChoice says the group continued to improve the stability of its applications and Showmax further localised its business by adding more local payment channels and partners, which enabled local billing in various markets.
In the period, MultiChoice had 22.1 million subscribers, with the subscriber base split between 13 million households (59%) in the rest of Africa and 9.1 million (41%) in South Africa.
On key performance metrics, the group’s revenue increased 7% (2% organic) to R28.6 billion, and subscription revenue amounted to R23.8 billion, up 8% year-on-year (3% organic), driven mainly by the rest of Africa that delivered a 27% increase (12% organic).
Advertising revenues were up 5% (2% organic), group trading profit increased 2% to R6.1 billion (6% organic), while core headline earnings increased 2% year-on-year to R2 billion.
Irdeto contribution
Turning to its technology business, Irdeto, MultiChoice says this segment continues to experience shortages in silicon supply and disruptions in global supply chains.
In the six months, software security and media technology company Irdeto’s revenue was down 13% year-on-year, to R700 million.
“Despite top line pressure, the segment contributed R400 million to group trading profit, as strong cost containment resulted in healthy margins. On a standalone basis (excluding intergroup eliminations), the Irdeto business generated total revenue of $105 million (R1.7 billion), representing reduction of 3% year-on-year. Trading profit on the same basis amounted to $24 million (R400 million), up $4 million from 1H FY22.”
During the current period, MultiChoice says, Irdeto continued to gain market share in the video entertainment sector, including deployments with a major European broadcaster and a leading media and entertainment company in South-East Asia.
“The business also continued to expand its deployment of connected vehicles with Hyundai, and started providing its Keystone solution in large truck fleets and construction equipment rental companies,” says MultiChoice.
“Denuvo, Irdeto’s gaming security arm, launched protection for games developed for the Nintendo Switch platform and joined Amazon Web Services for Games to broaden the reach of its solutions to include smaller game studios around the globe.
“Irdeto also won numerous industry awards and has been recognised as the winner in the best cyber security company category of the 2022 Cyber Security Excellence Awards.”
New money
Meanwhile, MultiChoice’s newest venture − Pan-African online sports betting company BetKing − reported strong revenue growth of 62% year-on-year and delivered $93 million (R1.5 billion) in gross gaming revenue.
“The business is growing rapidly in Nigeria and increasing its market share, whilst also strategically reviewing its expansion programme and identifying key expansion opportunities,” MultiChoice says.
BetKing’s average active users grew 84% year-on-year, while the number of active agents increased by 44%.
On KingMakers – a sports and digital entertainment platform in Africa – MultiChoice says it reported a $16 million (R300 million) loss after tax due to the impact of an ongoing investment in people and technology, as well as an increase in foreign exchange losses on extraction of cash from Nigeria.
Looking ahead, MultiChoice, led by CEO Calvo Mawela, says in the second half of the financial year, a core focus will be the broadcasting of the FIFA World Cup from November to December, and an ongoing push to produce more local content that resonates with customers.
In addition, the group says it will be looking to grow its online offering and further scale its Showmax-paying subscriber base.
MultiChoice says in light of the ongoing economic challenges facing various markets, the group will remain focused on tight cost management, and it remains committed to deliver a positive trading profit result in the rest of Africa segment in the current financial year.
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