Trading statement

Trading statement

Shareholders are advised that the Prosus group (“the Group”) is finalising its condensed consolidated interim financial statements for the period ended 30 September 2023.

Prosus N.V. (“Prosus”) is a subsidiary of Naspers Limited (“Naspers”), a company incorporated in South Africa and listed on the Johannesburg Stock Exchange (“JSE”) in South Africa.

For context, in terms of the JSE Listings Requirements, South African listed entities with a primary listing on the exchange are obliged to issue a trading statement as soon as they are reasonably certain that the upcoming financial results would differ by at least 20% from those of the previous corresponding period. Trading statements are generally issued to provide shareholders with a range of outcomes in respect of key financial metrics.

The financial results of Prosus almost completely account for Naspers’s results. Based on Naspers’s anticipated results for the period ended 30 September 2023, Naspers is required to issue a trading statement in terms of the above JSE Listings Requirements. To ensure that shareholders of Prosus are provided with equivalent information simultaneously, Prosus is issuing this trading statement.

For the six months to September 2023, our consolidated ecommerce portfolio excluding Tencent delivered peer-leading growth and accelerated profitability. We are on track to fulfil our commitment of consolidated ecommerce profitability and cash flow generation. This performance, combined with improved profitability from equity accounted investments and the continuation of the share repurchase programme, led to significant growth in core headlines earnings per share.

During the period, we delivered on our commitment to simplify the Group’s structure, with the successful removal of the cross- holding. We thank shareholders for their vote of support. The Group has made significant progress on its strategic priorities and will continue to target peer-leading growth and improving profitability. Furthermore, the Group will continue the open- ended repurchase while the holding company discount remains elevated and deliver a clear capital allocation strategy focused on high conviction opportunities. Strong business performance and increased scale will create opportunities to highlight the value of our investments. There is significant opportunity to increase returns in the Group’s investments and deliver long term value to shareholders.

The Group has illustrated below the anticipated changes in earnings, headline earnings and core headline earnings per share for continuing operations and total operations for the period ended 30 September 2023 as compared to the restated 30 September 2022 operations. Prior period numbers have been adjusted to reflect the impact of the removal of the cross holding and in the case of continuing operations both the removal of the cross-holding and the exit of the OLX Auto businesses. (Details discussed later in the statement):

 Continuing operationsRestated30 September 2022US cents30 September 2023 expected increaseUS centsExpected increase%
Earnings per N share (1)9142-4946%-54%
Headline earnings***per N share (1)746-48664%-679%
Core headline earnings**** per N share (1)3935-3891%-98%
 Total operationsRestated30 September 2022US cents30 September 2023 expected increaseUS centsExpected increase%
Earnings per N share (1)9043-5048%-55%
Headline earnings***per N share (1)746-48664%-679%
Core headline earnings**** per N share (1)3836-3995%-103%

Core headline earnings per share and headline earnings per share for the period are expected to increase in the current period. This growth is driven by improved profitability of our ecommerce consolidated businesses and equity-accounted investments, in particular Tencent, and an increase in our net interest income. Shareholders are reminded that the board considers core headline earnings an appropriate indicator of the operating performance of the Group, as it adjusts for non-operational items.

The increase in earnings per share was positively impacted by the Group’s improved profitability and lower number of shares due to the ongoing open-ended share repurchase. Earnings per share growth further benefitted from improved interest income received of US$0.4bn (H1 FY23: US$0.1bn) and lower impairment losses of approximately US$0.5bn (H1 FY23: US$1.5bn) on assets within the Group’s portfolio compared to the prior year. The Group’s gains realised on the sell down of Tencent and the Group’s share of fair value losses/gains from investees have remained fairly consistent period on period.

The gains relating to the sell down of Tencent and impairment charges impacting earnings per share are excluded from headline and core headline earnings per share.

The Group has restated the 30 September 2022 published information following OLX Auto’s classification as Discontinued operations and the removal of the Group’s cross-holding structure.

We have made meaningful progress in exiting our OLX Autos businesses. All of our OLX Autos operations that have been disposed of, classified as held for sale or closed down by 30 September 2023 are presented as discontinued operations. Prior period published earnings have been adjusted as follows:

30 September 2022Published US$’mRestated US$’m
Earnings from Total operations2 5352 535
Earnings from Continuing operations2 3452 556
Earnings from Discontinuing operations190(21)

The successful removal of the cross-holding between Naspers and Prosus was concluded in September 2023. The previous year’s earnings per share have been restated to reflect the capitalisation issue and removal of the cross holding and gives a like-for-like comparison to the financial year 2024 earnings per share. The financial year 2023 earnings per share is lower than in the past due to the additional shares issued to remove the cross holding. Prosus shareholders now own more shares than prior to the removal of the cross holding.

Below is a representation of the impact of the removal of the Group’s cross-holding structure on the number of shares utilised in the determination of the Earnings per share.

PeriodPublished WANOS*Capitalisation issue and removalof cross holding structureRestated WANOS*
30 September 20221 404 721 2301 392 906 871**2 797 628 101

* Weighted average number of shares in issue

** The Group issued 808 533 377 ordinary shares N and reinstated 584 373 494 ordinary shares N

Consequent to the capitalisation issue, and the classification of OLX Autos to discontinued operations, the per share information from continuing and total operations for 30 September 2022 has been restated as follows:

30 September 2022 – Continuing operationsPublished US centsRestated US cents
Earnings per N share16791
Headline earnings per N share7
Core headline earnings per N share6439
30 September 2022 – Total operationsPublished US centsRestated US cents
Earnings per N share18190
Headline earnings per N share147
Core headline earnings per N share7738

More details will be published with the condensed consolidated interim financial statements on Wednesday, 29 November 2023.

Financial information on which this trading statement is based has not been subject to an independent audit or review by the Group’s auditors.

About Prosus

Prosus is a global consumer internet group and one of the largest technology investors in the world.

Operating and investing globally in markets with long-term growth potential, Prosus builds leading consumer internet companies that empower people and enrich communities.

The group is focused on building meaningful businesses in the online classifieds, food delivery, payments and fintech, and education technology sectors.

Through the Prosus Ventures team, the group invests in new technology growth opportunities within logistics, fintech, health, blockchain, social and ecommerce platforms, agriculture and more.

The team actively backs exceptional entrepreneurs using technology to improve people’s everyday lives.

Each month, over two billion customers across the globe use the products and services of companies that Prosus has invested in, acquired or built.

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