MultiChoice Group said its annual profit rose 2% with strong subscriber growth and profit elsewhere in Africa offsetting poor market conditions in South Africa.

For the year to 31 March, core headline earnings per share, which strips off some non-recurring costs and foreign currency fluctuations, rose to R8.28 from R8.14 a year ago.

However, the company said it would not pay a dividend, saying the strength of its balance sheet remains a “core focus”, given the local economic crisis, weaker rand and funding needs for the business such as its streaming platform, Showmax.

MultiChoice has been investing billions of rand to fight off competition from streaming giants Netflix, Amazon and Disney.

Africa’s biggest subscription television firm entered into an agreement in March with US media conglomerate Comcast to create a pan-African streaming platform built on the Showmax platform.

The new streaming service, which would be majority owned by MultiChoice, would combine investment in local content with international content licensed from NBCUniversal and Sky.

The company’s R7.5-billion of cash at 31 March and R9-billion in available loans provide the flexibility to make Showmax the leading streaming platform on the African continent, it said.

Saturation

As MultiChoice grapples with saturation in its largest market, it has been relying on revenue and profit from elsewhere in Africa and from newer businesses.

Full-year revenue rose 7% to R59.1-billion rand, with a 16% rise outside of South Africa while its home market dropped 2%. Its shares were up 1.3%, in line with a 1.6% rise in the broader index. — (c) 2023 Reuters