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Naspers rewarded for its focus on emerging markets

Tue, 2009-06-30 14:07 — Valerie Arnould

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Naspers, a multinational media group, owner of Media24, one of the leading publishing groups in Africa, today reported a 30% increase in revenue to 26.7 billion rand (3.4 billion US dollars or 2.4 billion euros) for its financial year ending 31 March 2009. The group EBITDA growth accelerated over this period, reaching 6 billion rand (550 million euros or 776 million US dollars) or +23% YoY (FY08 +15%).

Koos Bekker, CEO of Naspers

Main drivers for these good results are the international Internet activities which now represent 21% of the group revenues and pay television (44% of revenues). "When people experience economic pressure, they spend more time at home, and pay-TV is an affordable form of entertainment," said Naspers Chief Executive Koos Bekker to Reuters.
The group strategy regarding Internet is a “community-based focus” and acquisition/ launch in emerging economies. Naspers completed around 200 million dollars of new acquisitions (or increase of its participation in the case of in the Internet area for the fiscal year 2009. Among its current properties, the e-commerce websites Allegro (Eastern Europe) and Ricardo (Western Europe) registered a revenue growth of 47%. Tencent in China (+87%) and in Russia (+42%) performed ahead of expectations. Those two platforms provide social networking, games, content, communication for Internet and mobile.
In December 2008 the group also signed an agreement to acquire a 37% interest in Xin An Media, a leading newspaper publisher in China, for a cash consideration of 315 million Rand.

On the print media side, the growth is less spectacular. In South Africa, print media experienced steady circulation across most emerging market titles but delivered a subdued revenue growth of only 6%, mainly due to a downturn in advertising which account for 36% of the revenue for the print media group. As advertising comprises 16% of the group’s total revenue base, the downturn had a limited impact on aggregate results. The newspaper and magazine branch in South Africa had revenue of 5.6 billon rand (510 million euros) and its EBITA is down 8% at 618 million rand (56 million euros).

Naspers is a leading multinational media group listed on the Johannesburg Stock Exchange (JSE) since September 1994. Over the past two decades the group has evolved from a traditional print media business in one country, to a broad-based e-media company in multiple markets. The group’s most significant operations are located in South Africa and elsewhere in sub-Saharan Africa, China, Russia, Eastern Europe, the Netherlands, India, Brazil and Thailand. Naspers subsidiary, the Media24 group is the largest publisher in Africa. Media24 Newspapers publishes almost 60 titles and about 341,8 million newspapers annually. Many of these titles are leaders in their respective markets, such as South Africa’s top-selling daily newspaper, Daily Sun. With a daily circulation of over 800 000, Media24’s dailies account for a large portion of the national newspaper circulation figures. Naspers also own 30% of book and magazine publisher Grupo Abril in Brazil since 2006.



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