Multichoice released its results for the first half of its 2024 financial year, revealing that its Nigerian sports betting business, Kingmakers, continues to rack up losses.
Since 2020, Multichoice has invested almost R6 billion in Kingmakers. However, it has not met expectations and has piled up significant losses.
Over the past three years, Multichoice was forced to write down its investment in Kingmakers by a significant amount.
Its R6 billion investment in Kingmakers is recorded to be worth only R4.73 billion in Multichoice’s books.
MultiChoice’s interim results revealed that Kingmakers is still not able to operate profitable and continues to burn cash.
Kingmakers increased its revenue by 22% from the previous interim results. However, due to the significant weakening of the Nigerian Naira, it only realised a 2% revenue increase.
At the same time, Multichoice reported that Kingmakers was able to decrease its losses from $16 million to $8.6 million.
Given that the Naira depreciated by more than 40% over the past six months, the actual net loss at constant currency rates is probably significantly worse.
Despite the challenges, MultiChoice remains upbeat about KingMakers, saying it continued to deliver strong underlying operating momentum.
It said the group continued to develop and launch new services in the Nigerian market. However, its core focus was the soft launch of SuperSportBet in South Africa on 9 November.
It is entering an established and competitive sports betting market in South Africa, but is betting on its brand strength to win market share from competitors.
“The strength of the SuperSportBet brand and exclusive partnerships uniquely positions the group to gain market share in a large and growing addressable market,” it said.
It added that KingMakers is focused on optimising the profitability of its agency business and growing its higher-margin online business.
The charts below provide an overview of Kingmakers’ financial performance over the last two years.