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Despite external pressures, MultiChoice’s strategy leverages a solid financial foundation, targeted investments, and disciplined cost management to drive future growth and deliver the best video entertainment to customers.

•           Unprecedented foreign exchange pressures and economic challenges in key African markets impacted earnings and dampens subscriber growth

•           On track to right-size cost base and grow new revenue streams to drive future growth as streaming gains traction at the expense of traditional pay-tv

•           Cost-cutting measures delivered R1.3bn in permanent savings, on track to reach increased full-year target of R2.5 billion

•           Showmax customer base grew 50% YoY as a leading streaming service in sub-Saharan Africa

•           Strong revenue growth in new products: DStv Steam +71%, DStv Internet +85%, DStv Insurance +31%, KingMakers +53%

•           Strong liquidity of R10 billion provides solid financial base to support growth

•           Negative equity position on track to be resolved in November 2024.

MultiChoice Group (MCG or The Group) continued to deliver exceptional video entertainment and execute on core strategic initiatives during the first six months ended 30 September 2024 (1H FY25).

However, unprecedented foreign exchange volatility severely impacted the Group’s interim financial results, while ongoing macroeconomic challenges weighed on customer growth and moderated overall performance.

Facing the most challenging operating conditions in almost 40 years and to generate desired returns, the Group has been proactive in its focus to “right-size” the business for the current economic realities and industry changes.

Although operating across Africa typically subjects the group to currency moves, abnormal currency weakness over the past 18 months have reduced the group’s profits by close to R7 billion.

Combined with the impact of a weak macro environment on consumers’ disposable income and therefore on subscriber growth, it required the Group to fundamentally adjust its cost base – which is exactly what has been done. The normal cost savings program was accelerated, resulting in permanent savings of R1.3bn in over the past six months and an increased target of ZAR2.5bn for the full year.

“We are making good progress in addressing the technical insolvency that resulted from non-cash accounting entries at the end of the last financial year. We expect to return to a positive net equity position by the end of November this year, supported by a number of developments and initiatives. The Group’s liquidity position remains strong, with over ZAR10bn in total available funds,” says Calvo Mawela, MultiChoice Group CEO.

The Group is also adjusting to global Pay-Tv challenges as streaming services, the rise of social media and changing consumer preference impact the traditional broadcast business. Showmax, which reported 50% growth YoY in its paying customer base, strategically positions the business to actively participate in the streaming revolution as it gains momentum across Africa. To create sufficient capacity and drive growth, the group stepped-up its investment in this business by an incremental ZAR1.6 billion during the interim period.

“We have successfully been implementing our strategy over the past few years, achieving key milestones such as our investment in KingMakers, returning the Rest of Africa business to profitability in FY23 and FY24, concluding the Showmax partnership with Comcast and investing in Moment. While we’ve made huge inroads to reduce our cost base, there’s still more work to be done”.

“However, our focus extends beyond cost efficiency—we are equally committed to grow the business. We remain committed to driving new revenue streams and see significant medium to long-term opportunities in video entertainment, particularly in streaming, and in our adjacent new businesses,” says Mawela

The Group reported strong momentum in its new products and services, which all delivered robust   YoY revenue growth, i.e. DStv Stream +71%, DStv Internet +85% and DStv Insurance + 31%. KingMakers reported a healthy 27% increase in its online monthly active users in Nigeria and grew its revenue in Naira by 53%, while newly-launched SuperSportBet is showing good early traction in South Africa.

Financial Results Overview

Subscriber base: The pressure on the linear pay-TV subscriber base was lower than the previous six-months, reflecting a 5% decline (0.8m) compared to 6% reported (1.0m) in 2H FY24. This reflects an improving sequential trend. On a YoY basis, the linear subscriber base declined by 11% or 1.8m subscribers to 14.9m active subscribers, impacted by the challenging macroeconomic conditions that negatively impacted discretionary consumer spend.

Group revenues: Revenues increased by 4% YoY to ZAR25.4bn on an organic basis, due to disciplined inflationary pricing and revenue growth of new products. On a reported basis, revenues declined by 10%, impacted by foreign exchange pressures on the Rest of Africa business and a stronger Rand against the US Dollar.

Group trading profit: The Group’s ongoing cost optimisation drive delivered ZAR1.3bn in savings, and together with other improvements in the business, it resulted in a 33% increase in trading profit before incorporating the Showmax costs. A ZAR1.6bn step-up in the investment behind Showmax to create capacity for growth, trimmed the organic trading profit to ZAR5.0, a decline of only 1% YoY. Foreign exchange losses in the Rest of Africa business amounting to ZAR2.3bn reduced reported trading profit to ZAR2.7bn.

Adjusted core headline earnings, the board’s measure of the underlying performance of the business, amounted to ZAR7m, impacted by foreign exchange losses and the investment in Showmax.

Cash flow and liquidity: The Group free cash flow remained positive at ZAR0.6bn, with ZAR5.7bn retained in cash and cash equivalents. Despite the increase in net interest costs and a higher average debt balance, the Group remains well-positioned to navigate current challenges with access to ZAR4.4bn in undrawn facilities.

Operational update

General entertainment and sport

Delivering content that customers love remains the Group’s core focus— whether it is the best of local or international general entertainment or the most exciting sport events.

In the past six months, the Group produced 2,763 hours of local content, bringing its local content library to 86,215 hours.

SuperSport reinforced its reputation as a global leader in sport broadcasting with extensive coverage of the Paris 2024 Olympic Games, EURO 2024, and the ICC T20 Men’s World Cup. Over the past six months, SuperSport has broadcast 10,240 live events and provided a total of 21,540 hours of live coverage, a 22% increase YoY. 

SuperSport Schools doubled its user base and crossed a milestone of one million registered users on its app, delivering over 35,000 hours of content over the past six months.

Business segments

As a mature business, MultiChoice South Africa is focused on subscriber retention and reconnections, identifying remaining growth opportunities, as well as optimising processes and systems to improve customer experience and operational efficiency.

In the Rest of Africa business, the Group is implementing several initiatives to support improved financials, including price adjustments to counter the impact of inflation, renegotiating content deals where feasible, restructuring select packages to enhance ARPU, optimizing the DTT network, and intensifying anti-piracy initiatives.

In FY25, Showmax is focussed on enhancing its content line-up, bedding down distribution partnerships, expanding payment channel integrations and refining its go-to-market strategy.

Irdeto delivered encouraging revenue growth, after securing a major customer in Asian and expanding managed services with a key customer in Australasia.

KingMakers continued to gain strong momentum in Nigeria, where BetKing Nigeria has secured the second position in the online betting market. SuperSportBet, the South African business launched late last year, is showing early signs of success and reported a remarkable tenfold increase in net gaming revenue over the past nine months.

Moment, now live in 40 African countries, has shown rapid growth since its launch last year, with total payment volumes (TPV) growing to USD242m. It is already processing almost 30% of the Group’s payments.

Looking Ahead

The Group continues to invest in its long-term future, focusing on the following strategic priorities:

•           Improving profitability and cash generation in the South African business.

•           Streamlining the cost base in the Rest of Africa to return this business to profitability.

•           Investing in Showmax to establish it as the leading streaming platform on the continent.

•           Supporting KingMakers, Moment and DStv Insurance to drive scale.

By executing well on these objectives, the Group will be well positioned to deliver future growth and create value as Africa’s leading video entertainment platform and most-loved storyteller.

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Despite external pressures, MultiChoice’s strategy leverages a

Mining

The recent Auditor General’s report has unveiled shocking lapses in the mineral export process, raising concerns about the authenticity of mineral content and the potential loss of significant revenue for the country.

According to the report of the Auditor General on the accounts of the republic for the financial year ended 31st December 2023, crucial X-ray fluorescence spectrometer (XRF) machines meant to verify mineral content in consignments, were either missing or non-functional at key border posts.

This is contrary to the existing procedures where minerals are required to undergo inspection using an XRF machine at the port of exit to ensure that their mineral content matches the accompanying documentation.

However, it was discovered that the Victoria Falls border post lacked an XRF machine, while the machine at the Chirundu border post was reported to be non-functional.

This oversight meant that mineral exports were not properly inspected to confirm their conformity with valuation certificates issued by the Ministry of Mines and Minerals Development, raising serious doubts about the accuracy of the exported mineral content.

Furthermore, a review of transit documents from March and April 2024 exposed a staggering inconsistency in the transit declarations as a total of 194 transit declarations, with guaranteed amounts totaling K53,980,245, had entered the country through various ports with the intention to exit through different ports, but had not actually exited the country.

The reports indicate that alarmingly, there was no evidence that the relevant authority had redeemed the bonds associated with these unaccounted transits as of August 31, 2024.

The implications of these findings are deeply concerning, as they point to potential irregularities and significant revenue losses in the mineral export process.

The lack of oversight and enforcement in ensuring the proper inspection of mineral consignments, combined with the failure to track and account for transit declarations, raises serious questions about the integrity of the country’s mineral export operations.

The revelation of these lapses also underscores the urgent need for comprehensive reforms and heightened oversight in the mineral export sector.

Without swift and decisive action to address these glaring deficiencies, the country risks further erosion of its mineral resource management and potential loss of vital revenue.

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The recent Auditor General’s report has unveiled

Agribusiness

The Avocado Grower Association Zambia (AGAZ) says the avocado industry in Zambia is reeling from a severe crisis as droughts have led to substantial tree losses among farmers.

Speaking in an exclusive interview with the Zambian Business Times – ZBT, Lungu revealed that the impact of the droughts has significantly affected production and revenue streams, with many farmers losing a large number of avocado trees.

Lungu expressed deep concern over the devastating effects of the water crisis, noting that most avocado farmers are unable to water their trees due to the lack of irrigation systems in their fields.

He added that this has resulted in major buyers running out of avocados due to the association’s inability to supply them.

Highlighting the broader implications of the crisis, Lungu emphasized the significant drop in production and its potential impact on revenue streams.

He underscored the industry’s previous success, citing the recent commencement of avocado exports, and lamented the current situation’s adverse effects on both farmers and the government.

Lungu drew attention to the government’s prior recognition of the avocado industry’s economic contributions, expressing concern that the crisis might overshadow the industry’s importance in policy discussions. He noted that while the government has historically focused on other agricultural initiatives, such as FISP, the avocado sector has been overlooked, despite a notable mention by the republican President Hakainde Hichilema.

Meanwhile, Lungu urged remaining avocado farmers to explore alternative, affordable irrigation methods, such as solar installations, to mitigate the impact of the water crisis on their plants.

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The Avocado Grower Association Zambia (AGAZ) says the avocado industry

Agribusiness

The Cotton Board of Zambia – CBZ Senior Cotton Inspector, Derrick Sichilima, has stated that the cotton sector needs an estimated K13 million to be revamped and upscale productions amid plans to reopen Mulungushi Textiles.

Speaking exclusively to the Zambian Business Times (ZBT), Sichilima explained, “We need about K13 million, but we have only received K3.2 million. To revamp the sector, especially with the reopening of Mulungushi Textiles, we need to collaborate with such institutions and fulfill our duties as regulators. Without adequate resources, it becomes difficult for us to operate effectively.”

He further highlighted that, despite the Ministry of Agriculture receiving significant funding, the cotton sector has not benefited fully.

“Most of the funds are directed towards social security, drought impact relief, and the Food Reserve Agency (FRA), leaving us without the support we need,” Sichilima stated.

He expressed concern that the limited funds are hampering the sector’s progress, adding, “We wish we had received a substantial allocation to help the industry, which is currently limping.”

“We need about 13 Million, but we have only received about 3.2 Million. if we have to revamp the sector, you know as a regulator, and with the coming in of Mulungushi Textiles there, we need to work together with that institution and do what we are supposed to do as regulators and advise, or give direction on how to go about this sector, now you know if we do not have resources it is difficult for us to operate.” He said

 “The Ministry of Agriculture has received a huge amount, but if you look at where that amount is targeted, it’s targeted to social security issues and also the impact of the drought as well as to FRA, that’s where the chunk of resources he as gone, so for us as a cotton board we have not benefitted.” He stated.

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The Cotton Board of Zambia - CBZ

Markets

Zambia’s private sector faces a severe liquidity crunch as commercial banks shift their focus to government securities, raising fears about stagnating job creation, reduced exports, and slower economic growth. The root of the liquidity problem lies in the fact that commercial banks are investing about 70% of their treasury in government bonds and treasury bills, leaving just 30% for private sector lending. In an exclusive interview with former Zambia Development Agency Director Makula Makasa, he mentioned that this trend has devastating effects on business operations and employment. “If companies don’t have liquidity, they can’t expand their operations, and that means no jobs are created,” Makasa explained.

The consequences are twofold:

  1. Revenue losses for the treasury—as businesses fail to grow, the government collects less in taxes.
  2. Weakened export potential—without expansion, companies cannot contribute to foreign exchange through increased exports.

One may ask the question, “Why are banks preferring bonds?” The answer is that banks are reluctant to lend to the private sector due to high risks. “The government is a safer bet. With global economies slowing down, banks are advised to keep their money where returns are guaranteed,” Makasa explained.

The global economic climate, particularly the slowdown in China and the U.S., has further pushed Zambian banks to avoid risky ventures. Even sectors with growth potential, like agriculture, are seen as unreliable due to droughts and erratic rainfall.

With fewer loans available, job creation efforts have stalled. Makasa highlighted that youth unemployment remains a critical issue. “If we don’t find ways to extend capital to the private sector, the number of unemployed youths will only increase,” he warned. The lack of jobs also threatens the stability of pension funds, as fewer workers mean fewer contributions to the national pension system.

Makasa stressed the need for creative solutions to re-engineer Zambia’s capital markets. He called for policies that encourage banks to lend to strategic sectors that can generate jobs and drive economic growth. “The government must take deliberate steps to stimulate the private sector. If we fail to address this liquidity issue, we risk stifling economic progress,” he cautioned.

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Zambia’s private sector faces a severe liquidity

Sport

Rugby is struggling to garner the much-needed pinnacle of success compared to other Countries due to the Government’s failure to actualize its pledges.

Recently the spotlight dawned on the sport when its Chief Executive Officer (CEO) Godfrey Ndunda a veteran and seasoned administrator resigned.

However, Zambia Rugby Union (ZRU) President Louis Chileshe Bweupe remarked that among the major challenges affecting the sport, is financial constraints due to the government’s failure to actualize its pledge to offer grants to all sports disciplines.

Bweupe noted that initially, the Ministry of Youth, Sports, and Arts had indicated that each Association was to receive K550, 000 but later in March, the Ministry rephrased the announcement that the grant would be reduced citing the realignment of the budget due to the drought, but as things stand the Associations are yet to receive anything from the Ministry.

Speaking in an exclusive interview with the Zambian Business Times (ZBT), Bweupe expressed disappointment that the pledges have not been provided and believed that this has affected Rugby which has been drastically belittled by the lack of support.

“The government had promised that this year every sport will be able to receive a grant which we had all planned and budgeted for, but that has not happened both this year and last year, I think the Minister and the PS are still having challenges to offset allowances to various players in various sports disciplines.”

He highlighted that the League is being sustained by Defence Force and Security wings sponsored sides, unlike the sides supported by the mines which are also struggling to fulfill their potential.

“We are thankful to have army sides, Zambia Airforce, Zambia Army, Zambia Police, and Zambia National Service for supporting teams the way they do, so these teams obviously because of the support they are doing fine, but when you come to a town like Roan, where the teams are traditionally sponsored by the mines, there is a huge problem there, you go to Ndola as well, Chibuluma, this is actually sad and i speak as President of the ZRU.”

Bweupe echoed that despite the sport being accoladed with the status of being the second most followed sport and number of players, there are major constraints that are scheduled to be tabled in an upcoming Indaba.


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Rugby is struggling to garner the much-needed

Tech

The Solwezi – Kipushi Road project which has been earmarked for face-lifting under the Public Private Partnership (PPP), and it is tipped to upscale the flow of goods and services between the Democratic Republic of Congo (DRC) and Zambia has dragged as the Solwezi District Commissioner has confirmed that that there is no development on the project.

In 2023 the Zambian Business Times (ZBT) had reported that a feasibility study was concluded, and in the present day Solwezi District Commissioner Anthony Fulwe has revealed “We do not have any circular to that effect, and the project is not on a yellow book.”

Speaking in an exclusive interview with the Zambian Business Times (ZBT) Fulwe stated that there are high expectations in light of the Economic significance of the project, highlighting that the implementers must realize the project in due time.

“When the President came here he mentioned some of the critical roads that are supposed to be worked on, and it was one of them, he talked about Kasempa, Mumbwa, Lusaka roads will be done but definitely we do not have any circular to that effect, I can’t give a concrete answer because when the President is talking to his people, he can mention that but the people at the lower level, they either may follow the policy or may suppress it, but for now there is nothing happening,” he said.

Fulwe underscored the vitality of the project, highlighting that it is as essential just like other borders like Kasumbalesa, in facilitating for a smooth flow of goods and services between the two Countries through Kipushi Border.

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The Solwezi – Kipushi Road project which

Mining

Chilanga Cement one of the leaders in cement production in Zambia has attributed the 15 percent increase in in production to the rising market demand.

Chilanga Cement production has increased to 562,626 metric tons from January to August 2024 compared to 489 602 produced within the same period in 2023 representing about 73, 000 metric tons increase which is about 15 percent.

Speaking in an exclusive interview with the Zambian Business Times – ZBT, Chilanga Cement Corporate Affairs and Communications Manager, Gift Danga attributed this surge in production to the escalating demand driven by various infrastructure projects such as road construction and other Community Development initiatives.

Danga stressed the impact of the increase in production, emphasizing that the surge was motivated by the revival of projects that were previously on hold in 2023, as well as the launch of new projects in the mining sector.

He emphasized that the demand for cement has been fueled by ongoing infrastructure developments, particularly in road and school construction, requiring a significant supply of cement to meet market needs.

Danga said the surge in production by Chilanga Cement aligns with the burgeoning activities in the construction and mining sectors, reflecting a positive shift in the market dynamics.

“If you compare with 2023, some of the projects were on hold and in 2024 some of those projects are being rolled out and there are other projects in the mines that have been launched.”

“Most of the projects launched such as road construction and school construction require a lot of cement and for us to cutter for that market we have to increase production so it’s just a matter of demand.” He said.

Danga added that this increase not only underscores the company’s ability to adapt to market demands but also positions Chilanga Cement as a key player in catering to the growing infrastructure and construction needs in the region.

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Chilanga Cement one of the leaders in

Agribusiness

The Veterinary Association of Zambia VAZ, has expressed skeptic over the implementation of budget allocations to the livestock sector in the 2025 national budget.

While acknowledging that the budget allocation to deal with diseases of national and international importance was on point, VAZ emphasizes the need for efficient disbursement of the allocated funds.

Speaking in a recent interview with the Zambian Business Times (ZBT), the President of VAZ, DR. Malcolm Chiyoba, stressed the importance of addressing diseases that could potentially affect neighboring countries, stressing the government’s responsibility to ensure the effective utilization of allocated resources.

He expressed optimism that the allocated funds would be released but underscored the necessity of directing resources towards addressing human resource challenges within the livestock sector.

The Veterinary Association of Zambia president urged the government to consider allocating resources to the employment of surgeons and paraprofessionals within the sector, emphasizing the crucial role of human resources in ensuring the effective management of livestock and disease control.

Dr. Chiyoba revealed that a sum of K1.8 billion had been allocated to the Ministry, underscoring the significance of proper implementation and utilization of these funds to address critical issues within the livestock sector.

“Like you may know some of the diseases, we have to help our neighbors we should not let them go out there, we have to deal with them and the government has the responsibility to be with us and make those allocations and we are so sure that the money will be released.” He said.

Chiyoba added that the government should also consider allocating some of the resources to addressing issues of human resource in the Livestock sector.

“The government needs to make those allocation, but we are so sure that the money will be released but issues of the human resource, we hope the government also addresses employment of surgeons and paraprofessionals.” He said.

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The Veterinary Association of Zambia VAZ, has

Agribusiness

Despite increased offloading of animals due to the severe drought in the country, the price of T-bone and other premium meat cuts has surged, according to the latest ZAMSTATS report. The annual inflation for T-bone currently stands at 9%, indicating a significant increase in prices.

Speaking in an exclusive interview with the Zambian Business Times (ZBT), the Agriculture Institute of Zambia Registrar highlighted the challenges faced by farmers, including reduced quality and weight of animals due to a lack of good nutrition. The drought has significantly affected the availability of high-quality feed, leading to cattle losing weight and producing less meat, thereby reducing the meat yield from each animal and impacting the supply of quality beef cuts like T-bone.

Despite the increased offloading of cattle, high costs for supplementary feed, water, and veterinary care are being passed on to consumers through higher meat prices. The drought-induced offloading has the potential to disrupt the normal supply chain, leading to inefficiencies that affect meat prices.

To address these challenges, the Registrar emphasized the need for feed efficiency strategies, improved animal health practices, and proper veterinary services to increase the supply of premium cattle and potentially stabilize prices.

Exploring local sourcing of cattle and implementing energy efficiency measures in processing plants has also been highlighted as potential solutions to reduce input costs and improve value chain efficiency.

He added that promoting alternative cuts of meat that offer high quality but are more affordable could help manage the demand for premium cuts like T-bone without driving prices higher.

“Drought affected the availability of good-quality feed, leading to cattle losing weight and producing less meat hence reducing the meat yield from each animal and reducing supply in terms of quality beef cuts like T-bone.” He said

 Ngosa added that despite having more for slaughter, farmers still face high costs for supplementary feed, water, and veterinary care stating that these costs are therefore being passed on to consumers through higher meat prices.

“The drought-induced offloading has potential to disrupt the normal supply chain, leading to inefficiencies that affect meat prices.” He stated.

“Abattoirs and meat processors should explore energy efficiency measures in processing plants to reduce overheads, while improving value chain efficiency. If demand for premium cuts like T-bone has outpaced supply, to avoid driving prices higher, there should be promotion of alternative cuts of meat which are cheaper but still offer high quality.” He said.

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Despite increased offloading of animals due to