MultiChoice Group expects a sharp decline in reported trading profit for the year ended 31 March as the JSE-listed broadcaster again blames a range of factors, including piracy and intense competition from streaming content platforms, for the poor performance.

Reported trading profit, including the impact of currency movements against the rand across many of the key African markets in which it operates, will fall by about 50%, MultiChoice warned investors in a trading update late on Thursday.

Stripping out the impact of forex translation effects and other changes, “organic” trading profit will decline by between 7% and 11%, it said.

The MultiChoice board considers trading profit and adjusted core headline earnings per share as “appropriate indicators of the operating performance of the group, as they adjust for non-recurring and non-operational items”.

While the earnings-per-share line will show a swing from a R9.35 loss last year to a profit this year, the jump is not the result of a stronger underlying performance but is instead due to corporate actions such as the sale of a 60% shareholding in NMS Insurance Services to Sanlam in November 2024 and a downward adjustment to a Showmax put option liability. Headline earnings per share will also do better than a year ago, rising by as much as 66%.

However, the underlying operational performance of the business, which is the subject of a takeover bid by France’s Groupe Canal+, does not look good.

‘Unprecedented’

“The current period has seen the continuation of unprecedented financial disruption for economies, corporates and consumers across sub-Saharan Africa due to several macroeconomic factors, including weaker average exchange rates, elevated inflation and interest rates and power supply challenges,” MultiChoice said.

“Combined with the impact of structural industry changes in video entertainment, such as the rise of piracy, streaming services and social media, as well as the cost of investing in Showmax, this has materially affected the performance of MultiChoice Group,” it said.

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“The group has acted decisively to counter these headwinds by focusing on key areas within its control such as maintaining inflationary pricing discipline, growing new revenue streams and driving further efficiencies to manage costs and cash flows.”

It also blamed the lower trading profit on the ongoing investment in Showmax, which it said is still at an “early stage of development and has yet to scale into its cost base”.

MultiChoice will publish its 2025 financial results on Wednesday, 11 June. TechCentral will provide full coverage of the results, and will bring its readers an interview with group CEO Calvo Mawela. – © 2025 NewsCentral Media

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