Naspers shares were trading more than 5% lower in Johannesburg early on Tuesday after the JSE-listed technology investor warned shareholders about a big slide in earnings.

For the six-month period ended 30 September 2022, Naspers’s core headline earnings per share from continuing operations will fall year on year by between 52.3% and 59.7%, the group said in a trading statement.

Naspers considers core headline earnings a “more appropriate indicator of operating performance” than headline earnings per share (Heps). Heps from continuing operations will decline by more than 100%, pushing the group into a loss on this financial reporting measure.

Core Heps declined due to “investment in adjacent opportunities in e-commerce [and] lower contributions from associates and Tencent”, Naspers said.

“During the period, growth expectations and valuations came under significant pressure as consumers adapted to the realities of higher inflation and interest rates on their daily lives and spending power. The group has taken action to meet these challenges and will take further action to continue delivering long-term value to our shareholders,” it said, without providing detail.

Naspers attributed the expected sharp decline in headline earnings to lower profitability across its associates, including its share in Tencent’s fair-value losses on financial instruments of US$372-million compared to fair-value gains of $1-billion a year ago.

“Headline earnings are also impacted by our increased investment in earlier-stage e-commerce extensions of autos, convenience and credit,” it said.