MultiChoice Faces Tough Market, Warns of Lower Dividends in FY25
MultiChoice warns of tough FY25 as economic challenges persist, household spending weakens, and dividends face cuts amid inflation and currency pressures.
MultiChoice is in the process of preparing its financial results for the year ending 31 March 2025 (“FY25”) and hereby provides a voluntary operational update in respect of certain aspects of its business.
Shareholders are referred to the MCG and MultiChoice South Africa (“MCSA”) interim financial results for the period ended 30 September 2024 which were released in November 2024. In those results it was, inter alia, indicated that:
- MCSA was operating in a challenging consumer environment, which resulted in negative subscriber growth and limited revenue growth. It was also cautioned that, due to very high levels of personal indebtedness, it would take time for positive developments, such as lower interest rates and a stable ZAR against the USD, to result in materially higher disposable income for South African consumers; and
- MCG was navigating unprecedented external adversities, including macro-economic headwinds, as well as disrupted power supply and severe currency depreciation in some of its key markets in the Rest of Africa. The combination of these factors, together with the increased investment in streaming, resulted in the group reporting depressed interim financial results.
Since then, the group has continued to experience pressure, as household spending remained constrained by the ongoing cost-of-living crisis, compounded by elevated inflation and interest rates in many of its markets. This is likely to impact negatively on performance in FY25. The group has returned to a positive equity position, but capital preservation remains a key consideration in the current environment.
While a decision regarding the MCSA dividend will be made by the MCSA Board in June 2025, Phuthuma Nathi shareholders should be aware that any MCSA FY25 dividend is likely to be significantly lower than prior years.
The information in this operational and market update is the responsibility of the directors of MultiChoice and has not been reviewed or reported by MultiChoice’s independent external auditors.
Shareholders are advised that this announcement is not a trading statement as per paragraph 3.4(b) of the JSE Limited Listings Requirements. Detailed annual financial results for FY25 are expected to be released on SENS on 12 June 2025.
