June 13, (THEWILL)- African Pay-TV operator, Multichoice Group, has blamed Nigeria’s economy as DStv active subscribers in the country declined by 18%.
Recall that Airtel Africa had last month blamed its losses on currency devaluation in Nigeria and Malawi.
In its financial result for the year which ended March 31, 2024, released on Wednesday, MultiChoice declared that the decline in Nigeria affected its overall subscriber database, leading to a 9 per cent decline for the year.
While the total subscription figure for Nigeria was not stated as it was lumped with other operating units outside South Africa tagged ‘Rest of Africa’ (RoA), it reported that the 18% decline in Nigeria brought the RoA’s total active subscribers down by 13% to 8.1 million from 9.3 million in 2023.
“The group’s 9% decline in active subscribers was mainly due to a 13% decline in the Rest of Africa business as mass-market customers in countries like Nigeria had to prioritise basic necessities over entertainment, while the South African business showed more resilience with a 5% decline.
“The Nigerian economy and consumers faced persistent challenges through FY24. The removal of fuel subsidies, sharp currency depreciation with the official naira halving in value, inflation climbing to over 30%, and higher emigration of the middle and upper class drove an 18% YoY decline in active subscribers,” the company said, adding that this also reduced Nigeria’s contribution to the Rest of Africa revenues from 44% to 35%.
It noted, however, that Ghana saw a similar subscriber trend given an inflation rate that is still above 20 per cent.
Multichoice further stated that due to the challenging market dynamics, the short-term focus of its RoA (Nigeria, Angola, Kenya, Ghana, and Zimbabwe) business was shifted from subscriber growth to safeguard profitability and cash flows.
“Several cost-saving initiatives were implemented, including scaling back significantly on decoder subsidies (-46% YoY or ZAR1.3 billion), and reducing selling, general, and administrative (SG&A) costs by ZAR500 million. These interventions enabled the Rest of Africa business to increase trading profit by 48% YoY to ZAR1.3 billion, it added.
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