Naspers FY numbers, still going strong

On Friday we saw the release of one of the most widely held stocks here for our investors, and in fact a company that has attracted a lot of attention on both sides of the investment aisle for the better part of the last decade. Naspers. For one, a company founded in physical printing of newspapers over a century ago has managed to stay relevant with investments at the right time in the likes of satellite TV and of course the biggest home run of them all, a very early investment in Tencent. Recently there has been a more accelerated investment in internet enabled businesses and divestments of less core businesses in key geographies. Notwithstanding streaming technology taking hold, our continent is a little behind the curve, and the company managed to add nearly 600 thousand households to their satellite TV business over the last year.

The results are able to be downloaded from Naspers website: Positive results for the year, accelerating growth operationally and financially. This is the better download: Summarised consolidated financial results for the year ended 31 March 2017.

Naspers have had a busy year, as usual. They have disposed of assets in Eastern Europe, have seen their investment in food delivery company Delivery Hero about to go public (this week), as well as Mail.ru purchasing a food delivery business in Russia. Tencent still forms the bulk of the business, more than three quarters. The e-commerce business has more profitable business segments now than ever, it will continue to suck a lot of cash! So much so that Naspers will continue to raise funds at what are historically low rates. See above, if you are reliable, you will attract debt investors.

There are many moving parts to Naspers, which makes the business difficult to value at any given time. It is of course a proxy for Tencent, that share price in Hong Kong Dollars is trading near the all time highs. Today it is 80 Hong Kong cents away. Not only does Naspers trade as a proxy for Tencent, the market discounts the rest of their businesses and in fact values them at next to nothing. We will do another detailed analysis of the results tomorrow.