MultiChoice reports N196.3 billion in subscription revenue from Nigeria

Despite high inflation, fuel shortages and frequent electricity blackouts in Nigeria, South African-based pay-TV operator MultiChoice Group’s full-year 2022 results showed Nigeria leads the Rest of Africa (RoA) in the percentage of subscription revenue and y-o-y subscription growth.

Checks by Nairametrics showed that when compared to other African countries with MultiChoice presence such as Kenya, Zambia, and Angola, Nigeria ranked first with y-o-y subscription growth of 11% and 43% of total subscription revenue in full-year 2022.

The growth was on the back of regionalisation which produced positive results to unlock market potential and agreement with FIRS to postpone court challenges and commence tax audits.

Also, the popularity of local content like Big Brother Naija had a massive impact on the performance of the RoA operations.

Kenya followed with a drop of 4% in y-o-y subscription growth and a 9% growth in subscription revenue during the financial year. Zambia reported a drop of 3% in y-o-y subscription growth and 7% growth in subscription revenues in FY’2022, while Angola trailed with y-o-y subscription growth of 1% and 5% of subscription revenue in FY’2022.

Nigeria Results

While MultiChoice does not fully disaggregate its numbers, the company provided insights into the performance of its Nigerian operations.

• The company said it generated a subscription revenue of ZAR 7.1 billion ($475.5 million) from Nigeria alone representing a 5% increase year on year. It reported subscription revenues of ZAR6.8 billion same period last year.
• Since MultiChoice receives revenue from Nigeria in naira, the actual amount received is N196.3 billion which the company converted at ZAR27.66 (or N412.9).
• MultiChoice subscription revenue excludes revenue from hardware sales, advertising revenue, and other revenues.
• Nigeria accounted for 43% of the total revenue from its Rest of Africa (ROA) operations without South Africa.
• The company also kept away ZAR600 million in relation to its tax audit with the Federal Inland Revenue Service.

MultiChoice also projected higher PayTV penetration for its Nigerian Business which is currently at 35% compared to South Africa at 53% and North America at 61%.

What the company is saying

Calvo Mawela, the CEO of MultiChoice Group, said: “Reduced losses in the Rest of Africa (RoA), a rebound in advertising revenues, and a continued focus on cost containment enabled us to absorb the R1.1bn ($74.5 million) impact of a normalisation in content costs as live sport returned and we resumed our local content production post the COVID-19 lockdowns”.

“As a platform of choice, our group will look to further expand our entertainment ecosystem by identifying growth opportunities that leverage our scale and local capabilities.”

What you should know

• MultiChoice Group posted a trading profit of ZAR 10.3b billion or $689 million for the year ended March 31, 2022, rising marginally by 0.4% over what it recorded the previous year.
• Its Rest of Africa (RoA) operations, which include Nigeria, reported $81.3 million in trading loss.
• Core headline earnings, which measure the board’s sustainable business performance, were up by 6 percent at $237.1 million.