Marc Hasenfuss: Market Watch

shares were trading on a consolidated basis at 1,950c for the ords and 1,650c for the N-shares.

When Seardel/E Media consolidated their shares on a 10for-one basis in late 2015 the shares were trading at 1090c for the ords and 760c for Ns.

The E Media market value sits at R2.5bn, well off the inferred value of R7bn in Remgro’s end-June 2013 financials. The results to end-March simply don’t give enough detail on the three broadcast platforms to draw conclusions about nearterm prospects — though it seems that e.tv grappled back valuable market share. With the earnings figure(s) not really reflective of E Media’s “operating” performance, perhaps attention should be paid to the operational cash flows of R336m — equivalent to more than 75c/share.

Net asset value, I calculate, sits at close to R14/share but, aside from a R657m property, comprises mostly intangibles and goodwill. My sense, though, is that E Media has taken its pain, and the company might deliver a more riveting performance in future — even if e.tv’s profit growth is offset by a less favourable arrangement between eNCA and host DStv and further development costs for the OpenView HD rollout.

The overriding question is: will E Media stay the course with OpenView HD? The same questions were asked by the market a few years after e.tv’s launch in the late 1990s. HCI and Remgro endured those early years stoically (the former even selling its Vodacom shareholding to prop up the television station). HCI and Remgro are home to some of the smartest corporate minds, and I would not discount chances of the profit picture at E Media being cleared up.