Global Courant
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Naspers has suffered significant losses in the past financial year and one of the reasons is that South Africa’s largest online retailer, Takealot, posted a loss of R400 million.
The company said: “The business environment in the fiscal year ended March 31, 2023 (FY23) was characterized by significant geopolitical and macroeconomic uncertainty. In the midst of that uncertainty, we acted decisively to strengthen our financial position and create shareholder value.”
It also mentioned that its e-commerce business maintained revenue momentum, expecting it to deliver significant earnings improvements in FY24 and beyond. The main contributors are food delivery and payments and fintech, with consolidated sales coming from continuing operations which are up 8% to US$6.8 billion (R126 billion).
In addition, the company’s operating losses increased from US$985 million (R18.2 billion) in FY22 to US$1.38 billion (R25.6 billion) in FY23. Trade losses increased from US$684 million (R12.6 billion) to US$844 million (R15.6 billion) on an annual basis.
The group added that its trading losses fell 21% in the second half of the year compared to the first, in line with its commitment to make its e-commerce business profitable by FY25. Major revenues also fell 48% to US$1.1 billion (R19 billion), which the company said was mainly driven by lower contributions from its employees, mainly Tencent, which was hit hard by the Covid-19 lockdowns and new Chinese regulations. Revenues also declined from US$249 million (R4.6 billion) to US$1.3 billion (R24 billion), reflecting the group’s lower profitability at its associates and higher operating losses for its consolidated activities.
“This was partially offset by lower share-based compensation costs related to the revaluation of the group’s cash-settled plan and no grants to executive directors, as well as lower net finance costs due to higher interest income on cash balances.” – the company added.
Take a lot:
Takealot’s gross trade volume (GMV) skyrocketed 13%, while sales in local currency rose 12%, excluding M&A. While that was the case, the group suffered a loss of US$22 million (R400 million), representing a -3% trading margin.
Naspers noted that this reflects slowing consumer demand due to rising inflation and high interest rates and added by saying, “In addition, profitability was impacted by rising operating costs due to ongoing nationwide rolling blackouts, escalating fuel costs and the effect of global supply chain constraints.”
Takealot’s GMW was up 14% year-on-year, while Superbalist sales grew 11% in fringe terms, despite further competition and declining consumer demand.
Takealot takes a huge loss
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