Between April and September 2024, MultiChoice Group, an African pay-TV provider, reports that its Nigerian division lost 243,000 customers for both its DStv and GOtv services.
According to MultiChoice’s financial results for the fiscal year that concluded on September 30, 2024, which were released on Tuesday, many of its customers have had to give up their decoders due to the high cost of food, power, and petrol.
Read also: Kenyans to pay more for DSTV subscription fees as MultiChoice hikes price by 4.7%
Nigeria and Zambia recorded the largest share of subscriber loss
According to the corporation, Zambia and Nigeria experienced the most losses in subscribers.
It further stated that 566,000 members were lost across the operations in the six months under review as a result of the strain on its subscriber base in Rest of Africa (RoA) operations, which persisted from the year before.
“The group’s linear subscriber base declined by 11 percent or 1.8m subscribers YoY to 14.9m active subscribers on 30 September 2024,” MultiChoice said.
“The loss in the Rest of Africa has been primarily due to the significant consumer pressure in Nigeria, where inflation has remained above 30percent for the majority of the last 12 months and, more recently, due to extreme power disruptions in Zambia.
“Of this decline, 298k related to Zambia and 243k related to Nigeria, with remaining markets on the continent reflecting only a minor decline of 25k.”
Naira devaluation contributed to MultiChoice subscribers’ loss
Regarding the foreign exchange (FX) rate, the business stated that additional losses on non-quasi-equity loans had been caused by the ongoing depreciation of the naira relative to the dollar.
“The group held $11m in cash in Nigeria at period-end, down from $39m at end FY24, a consequence of consistent focus on remitting cash, the impact of translating the balance at the weaker naira and the write-off of the USD21m receivable relating to the cash held with Heritage Bank before its licence was revoked and the bank was liquidated,” MultiChoice said.
Read also: Dstv’s anti-piracy campaign continues, another suspect apprehended
MultiChoice CEO comments on company’s challenges
Calvo Mawela, the CEO of MultiChoice Group, commented on the company’s performance, stating that it has been dealing with its most difficult operational conditions for nearly 40 years.
The company has been “proactive in its focus to right-size the business for the current economic realities and industry changes” to provide profits, according to Mawela.
He said while operating across Africa “typically subjects the group to currency moves, abnormal currency weakness over the past 18 months has reduced the group’s profits by close to R7 billion”.
“Combined with the impact of a weak macro environment on consumers’ disposable income and therefore on subscriber growth, it required the Group to fundamentally adjust its cost base – which is exactly what has been done,” he said.
“We are making good progress in addressing the technical insolvency that resulted from non-cash accounting entries at the end of the last financial year.
“We expect to return to a positive net equity position by the end of November this year, supported by a number of developments and initiatives. The Group’s liquidity position remains strong, with over ZAR10bn in total available funds.”
MultiChoice Nigeria legal battle
Even though the tribunal ruled against MultiChoice on April 25, the company nevertheless raised the subscription costs for DStv and GOtv bundles on May 1.
The following month, MultiChoice was fined N150 million by the tribunal, which also mandated that the corporation give Nigerians free one-month subscriptions to DStv and GOtv.
In a notice of appeal filed on June 7, 2024, MultiChoice requested a stay of execution on the tribunal’s ruling.
However, on July 12, 2024, the tribunal granted the claimant, Festus Onifade’s plea to withdraw the lawsuit. Costs were not awarded by the tribunal.
Leave a Reply