DStv-owner goes from bad to worse

MultiChoice has reported that its interim loss for the 2025 financial year will be far deeper than last year’s, with the company expected to make an estimated loss of R1.84 billion.

MultiChoice released a trading update for its interim financial statements for the six months through September 2024.

These results showed a deepening of the company’s loss per share and headline loss per share, as MultiChoice said it faced “the most challenging operating environment in the group’s history”.

MultiChoice also said that it entered the peak investment cycle of Showmax and expects losses and headline losses per share to increase as a result of the early life cycle of the Showmax business. 

In addition, the company expects to report a further R2.1 billion in foreign exchange rate movements through its income statement on non-quasi equity inter-group loans.

MultiChoice expects its trading profit to decline compared to the previous year and be close to flat on an organic basis. 

The company expects its loss per share to deepen by between 34% and 38%, while its headline loss per share is expected to deepen by between 45% and 49%.

This would bring the company’s loss per share to between 415 cents per share and 427 cents per share.

Daily Investor analyst Drikus Greyling calculated MultiChoice’s expected loss for the interim period.

At the high end, MultiChoice is expected to make an interim loss of R1.84 billion. At the lower end, the company is expected to make an interim loss of R1.89 billion.

It is important to note that this excludes the company’s foreign exchange losses for the period, which are estimated to be over R2 billion.

This can potentially put the group’s total comprehensive loss at over R4 billion for the interim period.

MultiChoice said its financial performance has been negatively impacted by severe pressure in the macroeconomic, foreign exchange rate and consumer environment in key markets, most notably Nigeria and Zambia. 

Therefore, the company is pursuing an inflationary pricing strategy and targeting R2.0 billion in cost savings to offset weaker subscriber activity and foreign exchange pressures. 

“The group has made strong progress against these objectives on a year-to-date basis,” the company said.

MultiChoice is expected to release its interim results on 12 November 2024.