Naspers is set to report an increase of at least 58% in interim earnings, driven by a push to make money from its businesses outside Tencent, while it will continue with the JSE’s largest share buyback programme on record.
In an update released after market close on Monday, the group said its e-commerce portfolio, excluding Tencent, delivered “peer-leading growth and accelerated profitability”.
Having set itself the goal of making this portion of the business profitable by 2025, it said it is on “track to fulfil our commitment of consolidated e-commerce profitability and cash flow generation”.
Core headline earnings per share (Heps) from continued operations are expected to rise 108%-115%. This metric adjusts for nonoperational items. With respect to total operations, core Heps is expected to rise 112%-119%.
The group said this growth is driven by improved profitability of its e-commerce consolidated businesses and equity-accounted investments, in particular Tencent, and an increase in net interest income.
During the period, the group took a step forward in simplifying its structure, with the successful removal of a complex and unpopular cross-holding between Naspers and its international unit Prosus.
The group launched an open-ended share repurchase programme last year as the latest in a string of corporate actions to crush the valuation shortfall between its market cap and value of its underlying assets.
This programme is set to continue.
“Strong business performance and increased scale will create opportunities to highlight the value of our investments. There is significant opportunity to increase returns in the group’s investments and deliver long-term value to shareholders,” the company said.
In September, Naspers announced that CEO Bob van Dijk, who led the company for a decade, will, for now, be replaced by Ervin Tu, the group’s chief investment officer.
Naspers’ share price, up 16.84% in the past month, firmed 0.64% on Monday to R3,392.50.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.