OVERVIEW OF GROUP RESULTS
Revenue
The group reported revenue growth of 19% to
R20,5 billion. The star was the internet segment, which grew by 42%. The pay-television segment expanded by 22% – subscriber growth over the period was 246 000 equated subscribers.
Operating profit
Operating profit before amortisation and other gains/ losses grew by 15% to R4,2 billion
(2007: R3,7 billion). Included is R1,1 billion (2007: R876 million) that the group invested in developing new technologies, products and services. This spend was lower than anticipated, due to the slower rollout of mobile television services, which are dependent on the issuance of commercial licences by regulatory authorities.
Finance income
Net finance income for the period amounted to R1,0 billion, compared with net finance costs of
R338 million in the prior year. This includes interest income earned of R602 million on net cash deposits. As the capital raised
in March 2007 was only deployed in the latter half of the current financial year, interest income in the year ahead will be lower.
Equity-accounted results
In the recent past the group acquired substantial minority stakes in businesses in emerging markets such as China, Brazil and Russia. For reporting purposes, these are equity-accounted and are excluded from the segmental results in the financial review. Tencent, Abril and mail.ru have all recorded pleasing growth, reflected in our share of earnings from equity-accounted associates, growing by 93% to R654 million.
The impairment of equity-accounted investments relates mostly to our investment in Beijing Media Corporation Limited and Titan Media. Whilst positive about the future prospects of these investments, we believe it prudent to record an impairment charge.
Discontinued operations
The discontinued operations relate to the private education business, which was sold, as well as to the pay-television activities in Greece and Cyprus, where sale agreements have been concluded and which we hope to close later this year. |
