MultiChoice Projects Significant Financial Decline for FY24 Amid Economic Challenges

MultiChoice Group has announced the finalization of its consolidated annual financial statements for the year ending March 31, 2024 (“FY24”), revealing substantial impacts from adverse economic conditions. As required by the JSE Limited Listings Requirements, MultiChoice has issued a trading statement indicating that its financial results will diverge significantly from the previous year, with losses expected to exceed 20%.

Despite efforts to manage costs and optimize cash flow, including reduced decoder subsidies, the company faces a challenging financial landscape. A summary of the estimated changes in loss and headline loss per share, as well as trading profit, core headline earnings per share, and adjusted core headline earnings per share, highlights the expected financial movements.

The company’s financial performance has been heavily influenced by an adverse economic environment, resulting in re-assessed business needs and subsequent impacts on reported earnings. Showmax, MultiChoice’s streaming service, has recorded an additional ZAR1.4 billion in trading losses year-over-year.

On an organic basis, the group expects an increase in trading profit due to inflation-led pricing and effective cost optimization across its markets. However, a ZAR4.5 billion foreign exchange impact from weaker currencies against the USD will likely result in lower reported trading profit compared to the previous year.

Despite some offset from realized foreign exchange gains, core headline earnings per share are anticipated to decline year-over-year. Adjusted core headline earnings per share, which includes ZAR0.9 billion in losses on cash remittances from Nigeria, are expected to show a lesser decrease due to the narrowing gap between the official and parallel NGN during FY24.