DStv rakes in subscribers, but they're spending less on average - TechCentral

DStv rakes in subscribers, but they’re spending less on average

MultiChoice Group’s average revenue per user (Arpu) has fallen by 5% in South Africa as consumers continue to flock to lower-priced bouquets.

Despite the tough economic conditions — which the pay-television group said show signs of further deterioration — the South African unit, its biggest, reported subscriber growth of 7% year on year for the six-month period ended December.

The growth in 90-day active subscribers amounted to an additional 600 000 customers on its books in South Africa.

Revenue growth was “muted” at just 2%, reaching R17-billion, as healthy subscriber growth in the mass-market segment was negated by a 0% price increase on the DStv Premium bouquet.

MultiChoice said it has arrested the decline in Premium customers as a result of the price freeze, with subscriber numbers stabilising at 2019 year-end levels.

Still, the shift in the subscriber mix to the mass market resulted in Arpu falling from R308 to R292/month.

Trading profit was slightly down from the prior period at R5.2-billion, mainly due to the cost impact of broadcasting three major sport events and once-off restructuring costs in the customer care division. “Despite these costs, the trading margin remained relatively stable at 30%,” it said.

DStv Now, Showmax grow

Connected Video users on both the DStv Now and Showmax platforms continued to grow, though MultiChoice does not share these numbers with the market.

In the rest of Africa segment, the group grew subscribers by 7%, or 700 000, year on year. Revenue in this segment was 5% (3% organic) to R7.8-billion.

Arpu in the rest of Africa was R111/month, down from R115/month, also due to a shift to mass-market plans.

The group’s overall subscriber base now stands at 18.9 million households, split between 8.2 million in South Africa and 10.7 million in the rest of Africa.

Group revenue was up 4% to R25.7-billion.

A R700-million reduction in losses in the rest of Africa underpinned the group’s trading profit improvement, which rose 22% to R4.8-billion.

Core headline earnings rose 24% to R1.9-billion, despite the 5% additional share allocation in MultiChoice South Africa gifted to Phuthuma Nathi empowerment scheme shareholders in March 2019. Excluding this once-off change, core headline earnings would have grown 37% year on year on a like-for-like basis.  — (c) 2019 NewsCentral Media

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