The parent company of MultiChoice Nigeria, MultiChoice Group, has disclosed a 30.77% decline in subscriber income from Nigeria for the full fiscal year that concludes in March 2024...READ THE FULL STORY HERE▶▶▶
Despite the hike in prices of subscription fee two times, BusinessDay reported that revenue decreased to $341.72 million from $493.59 in the prior year.
The company attributed this decrease to several factors, including increased fuel costs, historically high inflation that has above 33%, and the depreciation of the naira.
It stated, “Higher fuel costs in local currency also hurting consumers. Power interruptions of 16 hrs /day.
Official rate weakened 50% year-on-year versus the dollar, and liquidity remains tight, “parallel rate” closed N1600 vs. N1308 official rate,”
Economic challenges
These economic challenges resulted in a 9% overall, primarily from a 13% decline in its rest of Africa business, which was primarily felt in Nigeria, Angola, and Zambia.
In response to the strain on foreign exchange resulting from the depreciation of the naira versus the dollar, MultiChoice raised prices in April and November, bringing the annual rise to an average of 40%.
However, MultiChoice Nigeria suffered a $249.51 million foreign exchange loss as a result of these actions not being able to counteract the detrimental effects on income.
“The sharp NGN depreciation against the USD gave rise to ZAR4.6bn in foreign exchange losses on the nonquasi equity loan (intercompany) with MultiChoice Nigeria,” it stated.
Additionally, the company’s total revenue decreased by 5% to $3.04 billion (56 billion rands), mostly as a result of a 7% decline in subscription income brought on by the weaker naira. The trading profit for the group decreased by 21% to $428.50 million (7.9 billion rands).
“The business in the Rest of Africa faced the toughest macro-economic conditions in its core markets with high, double-digit inflation and extreme depreciation of local currencies (especially in Nigeria, Angola, Kenya, and Zambia), which impacted USD revenues by 32 per cent.
The active subscriber base declined to 8.1 million, but effective retention efforts contributed to an improved subscriber mix.”
Traders buy cheap petrol in Nigeria to sell for N1,700/litre in other markets it said.
Apart from its fiscal challenges, MultiChoice Nigeria is presently entangled in a legal dispute regarding its recent pricing hikes in Nigeria.
Nigerians can now get free one-month subscriptions to DStv and GOtv from the Pay TV provider, per a recent order by the Competition and Consumer Protection Tribunal.
It said: “The active subscriber base declined to 8.1 million, but effective retention efforts contributed to an improved subscriber mix.”
Apart from its fiscal challenges, MultiChoice Nigeria is presently entangled in a legal dispute regarding its recent pricing hikes in Nigeria. Nigerians can now get free one-month subscriptions to DStv and GOtv from the Pay TV provider, per a recent order by the Competition and Consumer Protection Tribunal.
In addition, the operator was fined N150 million for contesting the authority of an Abuja-based court’s ruling that barred it from raising subscription costs.
MultiChoice however has expressed disagreement with the decision and plans to appeal it.
