65% profit leap for Naspers in first 6 months

NASPERS reported a 65% jump in first-half profit yesterday, boosted by internet businesses that include the largest stake in China’s Tencent Holdings and narrower losses from its e-commerce assets.

Naspers owns a third of the fast-growing Chinese version of Facebook, which has overshadowed its other investments in both value and earnings, and has grown the revenue contribution of its internet division to 77% from 72% a year ago.

The share price of Naspers – which also has stakes in Germany’s Delivery Hero and Russia’s Mail.ru – has doubled this year, buoyed by Tencent’s sharp climb.

“It is clear that our internet operations are scaling very well,” CEO Bob van Dijk told reporters, pointing to the division’s revenue increasing 42% year on year to $6.9-billion (R93.9billion).

This helped to lift headline earnings to $1.5billion (R20.4-billion), or 350 cents per share in the half-year to the end of September, from $914million (R12.4-billion), or 212 cents per share, a year earlier.

The investment in Tencent has helped to transform Naspers from a small South African newspaper publisher into the continent’s most valuable company.

The group revealed no plan to unbundle its stake in Tencent‚ its main driver of revenue growth‚ as demanded by some shareholders.

It said it intended to bring its e-commerce business to profitability and would also continue to invest in emerging businesses that may power future growth.

Naspers shares were up 0.8% at R3 809 by close, versus a 0.6% rise in the JSE’s benchmark top-40 index.

Headline earnings per share, Naspers’ main profit measure, strips out non-operational and oneoff items. — Reuters