Financial Results Presentation For the six months to September 2014 - - PowerPoint PPT Presentation

Financial Results Presentation

For the six months to September 2014

This presentation contains forward-looking statements as defined in the United States Private Securities Litigation Reform Act of 1995. Words such as “believe”, “anticipate”, “intend”, “seek”, “will”, “plan”, “could”, “may”, “endeavour” and similar expressions are intended to identify such forward-looking statements, but are not the exclusive means of identifying such statements. While these forward-looking statements represent our judgments and future expectations, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. These include key factors that could adversely affect our businesses and financial performance. We are not under any obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements whether as a result of new information, future events or otherwise. Investors are cautioned not to place undue reliance on any forward-looking statements contained herein.

Important information

2

Overview Financials Internet Pay-TV Outlook Appendix

3

Pursuing simultaneous, significant growth opportunities

Becoming a major ecommerce player

1

Prioritising fast-growing segments in ecommerce

2

Mobile becoming dominant mode of internet access

4

Focusing on growth markets

3

Optimising the structure

5

4

Becoming a major ecommerce player globally

Monthly average desktop visits in billions, Y/Y growth % (excl. payments-related properties)

Source: ComScore, Naspers

1 2 3 4 5 6

Alibaba Amazon Naspers eBay Mercadolibre Rocket Internet Rakuten JD.com 3Q'13 3Q'14 5

Mobile becoming dominant mode of internet access

500 1 000 1 500 2 000 Developed markets Naspers markets

Mobile internet users by region (m)

Saudi Arabia Indonesia Poland South Africa Brazil India

As a group we are very well positioned

Source: Similarweb, 5 November2014

2014E vs 2018E

~2bn

Top Shopping Apps in the Google Play Store

6

Focusing on high growth markets

India (82%) Brazil (5%) South Africa (4%) Other (3%) Turkey (3%) Romania (3%)

1HFY15 M&A by country (ZAR3,9bn)

India (15%) Brazil (13%) South Africa (14%) Nigeria (11%) Indonesia (4%) Other (43%)

1H FY15 Development spend* by country (ZAR4,4bn)

* Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated

7

Prioritising fast growing segments in ecommerce

Emerging markets: visits per segment (% change YoY) +4.2% +4.1%

• 5.0
• 2.1%

Source: IDC, Naspers

8

0% 15% 30% 45%

Etail Classifieds

3Q 2012 3Q 2014

Population size (m) Our position* Brand

#1 58.com #1 OLX

• #1

OLX #1 OLX #1 OLX #1 OLX #1 OLX #1 Avito

• #1

OLX

• #1

Dubizzle

Strong asset base for growth in classifieds

9 82 90 94 98 122 127 143 157 174 182 200 250 316 1,252 1,357

Egypt Vietnam Ethiopia Philippines Mexico Japan Russia Bangladesh Nigeria Pakistan Brazil Indonesia US India China

*Including associates Source: World Bank

Optimising the structure: rest of ecommerce

Strengthened management across operations

10

Etail

+

• Two of SA’s leading etail businesses

combine to create a platform of scale

• Customers to benefit from wider

selection of products and categories, as well as broader delivery services

• Deal subject to Competition

Commission approval.

Merger

Other

Sold

• Strategic decision to focus on the

consumer ISP business, without being an infrastructure player.

• Subject to Competition

Commission approval

• Outside of focus area
• Fairly small and mature markets

Marketplaces

• Transformation to create a more

customer-focused and agile business

• Specific emphasis on removing

corporate layers - likely to result in headcount reduction of 300+

• Re-investing in mobile development

— 80 engineers to be added

Restructured

Overview Financials Internet Pay-TV Outlook Appendix

11

4.9 6.1 Revenue (ZARbn) Core headline earnings (ZARbn) 28.8 34.4 12.48 15.28 Core HEPS (ZAR)

Sep 13 Sep 14

2.98 4.0 Development spend (ZARbn) 20% 35% 24% 22%

1H FY15: Synopsis of consolidated financials

12

Focus areas showing strong growth in revenue

Incremental revenue* by segment, YoY (ZARm)

Revenue by business segment*

35,817 20,186 5,979

Internet (58%) Pay TV (32%) Print (10%)

10,930 3,109 337 47,606

Sep 13 Internet Pay-TV Print Sep 14

61,982

44% 18% 30% 6%

* Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated

Revenue* (ZARm)

45,108 56,522 76,776 104,981 47,606 61,982

Mar 11 Mar 12 Mar 13 Mar 14 Sep 13 Sep 14

CAGR 30%

72% of revenues earned offshore Internet

Fastest growing revenue segment Constitutes 58% of group revenues Revenue trends:

• Ecommerce +43% YoY
• Tencent +46% YoY
• Mail.ru +19% YoY

Pay-TV

Benefited from :

• 16% increase in subscribers YoY
• 5% increase in subscription rates in SA

Print media

Large scale structural changes in industry Tough trading conditions continue:

• Media24 +1% YoY

13

More opportunities resulting in increased spending

14

Incremental development* spend by segment, YoY (ZARm)

4,374 1,154 72 71 3,077 Sep 13 Ecommerce Pay-TV Print Sep 14

48% 13% 42% 87% Further investment

Major investments in high growth markets Focus on building leading positions

Ecommerce

Larger classifieds footprint resulted in higher spend Increased spend in etail, also impacted by larger holdings in Souq and Flipkart Bigger investment in payments to scale and expand market share Larger markets of investment include India, Brazil and Indonesia

Pay-TV

ZAR465m invested in DTT Additional ZAR177m spent on:

• nline and mobile technologies
• decoder development
• Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated

Summarised consolidated income statement

Sep 13 ZARm Sep 14 ZARm Revenue* 47,606 61,982 Less: Associates and joint ventures (18,851) (27,619) Consolidated revenue 28,755 34,363 Trading profit 2,926 2,798 Trading margin 10% 8% Net finance costs (915) (1,208) Share of equity accounted results 5,139 9,932 Impairments (1,841) (173) Taxation (1,447) (1,755) Net profit 3,423 9,269 Core headline earnings 4,920 6,077 Core headline EPS (ZAR) 12.48 15.28

* Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated

Currency impact

Revenue* up 24% on constant currency basis

Trading margin

Decline due to increase in development spend

Net finance cost

55% increase in net interest on loans due to:

• Higher debt levels to fund acquisitions
• Negative effect of currency translation
• US$1bn bond issued in July 2013

Income from associates

Includes ZAR4.8bn (Sep 13 ZAR1.3bn) book profit from:

• Re-measurement of Mail.ru’s interest in VK and

its sale of shares in Qiwi (ZAR3.9bn)

• Tencent’s sale of some investments (ZAR887m)

Taxation

Increase due to higher profits in pay-TV, Allegro marketplace and OCS 15

Core headline earnings drivers

Incremental core headline earnings drivers, YoY (ZARm)

6,077 4,920

Sep 13 Development spend* Pay-TV profit* Profits from listed assets Ecommerce* Tax & Interest Other Sep 14

24%

** Excludes development spend on an economic interest basis

(1,298) 588 564 1,940 (601) (35)

* Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated

16

Investment in growth opportunities dampens FCF

Sep 13 ZARm Sep 14 ZARm Operating cash flow 3,904 2,490 Capex (1,978) (1,435) Finance leases (382) (445) Tax (1,591) (2,086) Investment income 834 1,047 Free cash flow (FCF) 787 (429)

Operating cashflow

Down due to higher development spend

Working capital

Almost all etail operations now generating negative working capital

Capex

Pay-TV ZAR1bn (mainly DTT and facilities) Ecommerce ZAR278m

Finance leases

Impacted by new satellite lease for MCSA

Investment income

Includes ZAR1bn dividend from Tencent 17

Balance sheet solid

Sep 14 ZARm Debt: (offshore US$2.9bn) (33,203) Cash: (South Africa R4.2bn) 10,755 Closing net debt (22,448) Interest cover 9x Net debt/ Adjusted EBITDA 1.36x Value of marketable listed securities/Debt 24.5x

Increase

US$369m of debt-funded acquisitions Some currency impact on translation

Net debt

Excludes transponder leases of ZAR7.6bn, considered to be an operating cost

Gearing 29%

18

Overview Financials Internet Pay-TV Outlook Appendix

19

Ecommerce growing strongly: YoY performance metrics

Etail Monthly active users

226m

New mobile listings

+345%

New listings

+83%

Average daily GMV

+59%

Items sold

+36%

Daily visitors

+39%

Daily payment transactions

+70%

Payments TPV

+36%

Classifieds Other

Items sold on marketplaces

753k /day

20

3,085 4,218 6,643 12,386 20,355 8,502 12,141

(107) (207) (1 238) (2 337) (5 329) (1 859) (2 426)

(6 000) – 6 000 12 000 18 000 24 000 Mar 10 Mar 11 Mar 12 Mar 13 Mar 14 Sep 13 Sep 14

Revenue Trading profit/(losses)

Ecommerce: strong organic revenue growth

Strategic

Fastest growing segment Focus on building leading positions in growth markets Investing in etail, classifieds and payments – all gaining market share from other formats

Operational

Execution capacity and operations are strengthening throughout the group Focus on customer satisfaction, engagement and retention metrics Mobile remains central to our plan

Financial

Trading loss ZAR2.4bn after incurring development spend on an economic interest basis of R3.6bn

Ecommerce revenue and trading profit/(losses) (ZARm)

43% 21

* Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated

Etail: focusing on attractive markets

+59%

average daily GMV

11

companies

19

markets

22

India & SE Asia (48%) Europe (41%) Africa & Middle East (11%)

Etail*: revenue growth accelerating

GMV by region

*Excludes marketplaces, OCS and online services

4,064 6,690

• 3,500

7,000 Sep 13 Sep 14

65% Revenue (ZARm) Strategic

Scaling operations in attractive markets Delivering compelling customer propositions Expanding through M&A

Operational

Substantial increase in organic traffic Major acceleration in Flipkart’s growth rates (category expansion, exclusive supply, differentiated logistics and fulfilment, price leadership) Souq and eMag scaling well Proposed merger of Kalahari and Takealot places business on better footing Fashion businesses restructured and losses reduced

Financial

Revenue growth mainly organic Margins low, but steady and consistent with category Negative working capital cycles across most

• perations

23

* Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated

Payments: focus on becoming leader in new world growth markets

24 Latin America*

Chile, Panama, Peru, Brazil, Argentina, Mexico, Colombia

Europe

Poland, Czech Republic, Turkey, Ukraine, Hungary, Romania, Russia

India

South Africa, Kenya, Nigeria

Africa

1

brand

18

markets

$$$$$ Buy Rate Multiple Acquiring Banks Online Merchant $$$$$ Sell Rate

Classifieds: joining forces to develop markets

Strategic benefits of agreement

A single large platform Combine know-how Share costs

Salient features of transaction

• Agreement with Schibsted (also Telenor and SPH)
• JV’s in Brazil, Indonesia, Thailand and Bangladesh
• Transaction based on relative metrics
• A single, sustainable platform in each market
• Cash neutral, some adjustments to working capital
• Subject to EU approval

25

Classifieds: OLX the leader across emerging markets

+20

Offices

+40

Countries

+1,200

Employees

Reach

+200M

MONTHLY ACTIVE USERS

+35M

MOBILE APP DOWNLOADS

Activity

25M

Monthly listing

8,5M

Monthly transactions

11B

Monthly page views

26

Note: numbers include OLX brand only

Country YoY growth Brazil 1,241% Nigeria 548% Global 345% Poland 267% India 219%

Classifieds: mobile transforming our business

27 2 4 6 8 10 12 14 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14

Mobile listings [indexed on Sep 2013]

OLX India continues to strengthen its leading position

OLX Mobile listers Brand awareness

Source : Google trends

28 Net new listings (for sale + vehicles), indexed

Source: Mobile website and app data

• 300 000

600 000 900 000 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14

Source: Website data

• 2

4 6

Apr-14 May-14 Jun-14 Jul-14 Aug-14 Quikr OLX

Android app downloads in India since launch (m)

Source: Google play store, AppAnnie

Quikr OLX

5-10 15.6

2x

+220% YoY

Classifieds: rolling out aggressively, following playbook

Strategic

Aggressive expansion strategy Professional operations Roll-out following best in class play-book

Operational

Outgrowing competition on most important metrics (focusing on mobile) Strong user and listing growth Increased engagement through improved offering and customer focus Mobile traffic rising rapidly

Financial

ZAR2.1bn investment in organic growth, up 46% YoY Monetisation in Russia, UAE, Portugal, Poland, Bosnia and Bulgaria 29 16 2 12 1 5 5 23 6 Entering Fighting Leading Leading and monetizing 2013 2014

Naspers positions (number of countries)

Population size (m) Our position* Brand

#1 58.com #1 OLX

• #1

OLX #1 OLX #1 OLX #1 OLX #1 OLX #1 Avito

• #1

OLX

• #1

Dubizzle

As a result, we have a fantastic asset base for growth

30 82 90 94 98 122 127 143 157 174 182 200 250 316 1,252 1,357

Egypt Vietnam Ethiopia Philippines Mexico Japan Russia Bangladesh Nigeria Pakistan Brazil Indonesia US India China

*Including associates Source: World Bank, 2013

Listed internet:

9,838 12,254 15,479 19,194 9,628 15,633*

Dec 10 Dec 11 Dec 12 Dec 13 Jun 13 Jun 14

62%

CAGR

+25%

Tencent operating profit (RMBm)

Value-added services (79%) Ecommerce transactions (10%) Advertising (8%) Other (3%)

Revenue mix 1H FY14*

Q3 2014 statistics

• 468m combined monthly active WeChat and Weixin user accounts

(+39% YoY)

• 542m monthly active smartphone QQ IM user accounts (+36% YoY)

Operations

Business performing well across all segments Establishing foothold in O2O space Profitability boosted due to reduced operating expenses relating to the divested ecommerce operations

Financials

Contribution to core earnings up 41% YoY to ZAR6.2bn ZAR1.4bn profit on JD.com transaction already included in our FY14 financials

*Reflects 100% of Jan-Jun 2014 results available on www.tencent.com Effective from Mar 11 2014, Tencent has divested its B2C and C2C eCommerce marketplaces and deconsolidated such revenues 1H FY15 ZAR/RMB1.732 (1.607)

31

Listed internet:

3,628 8,381 11,535 15,087 6,706 8,047*

Dec 10 Dec 11 Dec 12 Dec 13 Jun 13 Jun 14

20%

CAGR

+61%

Mail.ru EBITDA (RURm)

Community IVAS (33%) Display advertising (31%) MMO Games (25%) Other (11%)

Revenue mix 1H FY14*

Q3 2014 statistics

Monthly audience of Mail.ru portal now 57.8m

Operations

Results affected by geopolitical issues Advertising revenues weaker MMO games and community IVAS broadly on target Acquired remaining 48% of VK for US$1.47bn

Operations

Contribution to core earnings up 30% YoY to ZAR528m

*Reflects 100% of 1H FY14 aggregate segment performance as reported For IFRS results with full disclosure refer to www.corp.mail.ru 1H FY15 ZAR/RUR 0.297 (0.304)

32

Overview Financials Internet Pay-TV Outlook Appendix

33

Pay-TV strategy: continuing to build the platform

More investment in local content

3

34

• HD channels opened to non-premium tiers
• BoxOffice averaging 600k VOD purchases p.m.
• Customer service levels improved to 95%
• Bouquets optimised

Focus on better products

2

Scale DTT operations

1

Pay-TV: solid performance

Pay-TV subscriber homes (‘000) Subscribers

1.14m net additions YoY (+342k YTD)

• Non-premium accounted for 96% of growth
• Premium stable
• 872,515 DTT subscribers at 30 Sep

PVR base increased 15% YoY to 1.2m

Operations

Regulatory pressures intensifying Increased competition Clean-up of base resulted in disconnection of 159k non-revenue generating subscribers (Easy Access) Continue to invest in online products, new launches soon Mweb consumer ISP retained (Mweb Business sold)

Financials

Margin pressure due to:

• weaker ZAR resulting in higher content costs
• continued investment in local content
• ongoing DTT costs

3,214 3,698 4,168 4,699 5,174* 1,234 1,499 1,837 2,560 3,227

– 2,000 4,000 6,000 8,000 10,000 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 South Africa Sub-Saharan Africa

16% CAGR 17%

22,259 25,259 30,257 36,271 17,077 20,186 5,927 6,379 7,559 8,520 4,477 4,969 Mar 11 Mar 12 Mar 13 Mar 14 Sep 13 Sep 14 Revenue Trading profit 27% 25% 25% 23% 26% 25% Margin

Pay-TV financials (ZARm)

35

*Excludes disconnected Easy Access subscribers

Digital Terrestrial Television (DTT)

23 151 377 541 817 873

• 300

600 900 Mar 12 Sep 12 Mar 13 Sep 13 Mar 14 Sep 14

DTT Subscribers (‘000)

Jun 15

11

Countries

142

Sites

Operations

• DTT network now largely in place
• Subscriber growth momentum affected by:
• Regulatory delays/challenges
• Delayed analogue switch-off dates
• Focusing on differentiated content offering

36

Expected Analogue Switch Offs

Initial Revised Expected Kenya Dec 2013 Sept 2014 Dec 2014 Nigeria Jun 2014 Dec 2014 Apr 2015

Overview Financials Internet Pay-TV Outlook Appendix

37

Outlook: further growth and scaling of operations

38

Ecommerce

• Scale up in focus segments (etail, payments) in

geographies with high mobile growth

• Solidify strong classifieds position
• Deliver profitability from marketplaces and OCS
• Seed online services further (India and Latam)
• Revenue growth momentum to be maintained
• Seasonal business cycle likely to result in sequential

development spend increasing somewhat.

• Accelerated investment in online services
• Build-out of DTT subscriber base
• Deliver efficiency gains in mature businesses

Financials Pay-TV

Overview Financials Internet Pay-TV Outlook Appendix

39

Consolidated income statement – US$

1H FY15 ZAR/US$10.73 (9.86)

Sep 13 ZARm Sep 14 ZARm Sep 13 US$m Sep 14 US$m Revenue 28,755 34,363 2,917 3,201 Operating profit 1,621 2,253 164 210 Finance costs (915) (1,208) (93) (113) Share of equity accounted results 5,139 9,932 522 926 Acquisitions and disposals 614 118 62 11 Dilution profits (836) (71) (85) (7) Impairment of equity accounted investments (753)

• (76)
• Profit before taxation

4,870 11,024 494 944 Taxation (1,447) (1,755) (147) (163) Net profit 3,423 9,269 347 864 Attributable to: Naspers 3,112 8,937 316 833 Minorities 311 332 31 31 40

Core headline earnings

Sep 13 ZARm Sep 14 ZARm Headline earnings 3,641 4,484 Equity-settled share scheme charges 429 587 Deferred tax adjustments (49)

• Amortisation of intangible assets

690 741 Business combination gains/(losses) 12 21 Retention option expense 72 109 Fair value adjustments & currency translations 125 135 Core headline earnings 4,920 6,077 41

Impact of currency movements

ZAR weakness positively impacted translation of offshore earnings

Revenue growth YoY * Trading profit growth YoY * Core earnings growth YoY Average Closing rate Currency (ZAR = 1FC) Sep 13 Sep 14 % change Mar 15E Sep 13 Sep 14 % change US dollar 9.86 10.73

• 9

10.87 10.11 11.31

• 12

Euro 13.00 14.36

• 10

14.82 13.66 14.27

• 5

Chinese Yuan/Renminbi 1.61 1.73

• 8

1.73 1.65 1.84

• 12

Brazilian Real 4.45 4.72

• 6

4.57 4.49 4.61

• 3

Polish Zloty 3.06 3.44

• 12

3.49 3.23 3.41

• 6

Russian Ruble 0.304 0.297 2 0.30 0.31 0.29 6 61,982 58,984

• 35,000

70,000 Reported Constant Currency +30% +24%

11,356 10,785

• 4,000

8,000 12,000 Reported Constant Currency +34% +27%

6,077 5,916

• 3,000

6,000 Reported Constant Currency +24% +20%

42

FX exposure: hedging to manage risk

Annualised net foreign input costs

Pay-TV: US$342m and EUR4m (programming rights and leases) Print: EUR31m and US$3m (paper and ink)

Hedging strategy

Pay-TV: long-term commitments, cover up to 100% of rolling 12 -24 month net inputs Print: short-term commitments, cover maximum 12 months rolling input costs Bond/RCF: hedge interest expense to a maximum of 24 months

FEC’s

Almost all FEC’s qualify for hedge accounting US$ FX Cover US$m US$ rate FY15 212 10.99 FY16 285 11.34 EUR FX Cover EURm EUR rate FY15 35 14.82 FY16 1 14.84 43

Components of revenue growth

2,998 11,185 193 47,606 Sep 13 Exchange rate impact Organic growth Acquisitive growth Sep 14 61,982

Incremental revenue YoY* (ZARm)

* Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated 24% growth from existing operations

• Tencent (+38%) and Mail.ru (+21%) in local

currency

• Ecommerce +27% YoY
• Pay-TV revenues +15% YoY

Organic growth

6% revenue uplift from weaker ZAR Devalued 8% vs. Rmb and 9% vs. US$

Exchange rate

Driven mainly by increased stake in Flipkart

Acquisitive growth

30%

44

21,425 25,802 34,172 47,606 61,982 631 1,126 1,591 3,077 4,374 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14

Revenue Development spend

Development spend* breakdown

Revenue* and Development spend (ZARm) 1H FY15 split by business segment As % of revenue*

Sep 13 ZARm Sep 14 ZARm % Change Ecommerce 2,425 3,579 48% Pay-TV 570 642 13% Print 82 153 87% Total 3,077 4,374 42%

3,579 642 153

Ecommerce (82%) Pay-TV (15%) Print (3%)

2.9% 4.4% 4.7% 6.5% 7.1%

0% 2% 4% 6% 8% Sep 10 Sep 11 Sep 12 Sep 13 Sep 14

30% 42%

* Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated

45

Ecommerce: development spend*

1H FY15 development spend by type

2,079 950 242 308

Classifieds (58%) Etail (26%) Payments (7%) Other (9%)

2,955 4,409 8,502 12,141 616 1,042 2,425 3,579 Sep 11 Sep 12 Sep 13 Sep 14 Revenue Development spend

Revenue* and development spend (ZARm)

655 334 150 16 2,425

Sep 13 Classifieds Etail Payments Other Sep 14

Incremental development spend YoY (ZARm)

3,579

43% 48%

* Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated

46

Trading profit trimmed by organic expansion

* Based on economic interest, i.e. assuming equity accounted investments are proportionately consolidated

1H FY15 split by business segment*

6,477 4,969

Internet (57%) Pay TV (43%) Print (0%)

11,356 2,598 (34) 492 (206) 8,506

Sep 13 Internet Pay-TV Print Corp Sep 14

Incremental trading profit by segment* (ZARm) 67% 11% 34%

• 96%
• 53%

Trading profit* (ZARm)

10,546 11,762 14,326 15,613 8,506 11,356

Mar 11Mar 12Mar 13Mar 14 Sep 13 Sep 14

Internet

R9bn contribution by Tencent and Mail.ru Reduced by Ecommerce loss of ZAR2.4bn Increased profitability from:

• Allegro marketplace
• OCS businesses

Pay-TV

DTT roll-out continuing Accelerated investment in local content Positive contribution from Irdeto

Print

Affected by declining advertising revenues and investment in new revenue streams 47

Contribution by associates and joint ventures

6,437 (66) 9,932 (3,495) 9,998 Company results PPA adjustments IFRS results Other adjustments Core HEPS Contribution Company PPA IFRS Other Core HEPS ZARm results adjustments results adjustments* contribution Tencent 5,923

• 5,923

274 6,197 Mail.ru 4,401 (41) 4,360 (3,832) 528 Other (326) (25) (351) 63 (288) TOTAL 9,998 (66) 9,932 (3,495) 6,437

* Headline and core earnings adjustments similar to Naspers methodology

Associates and joint ventures contribution to Core HEPS (ZARm)

48

Net finance costs

US$700m 7-year bond issued July 2010:

• 6.375% coupon

US$1bn 7-year bond issued July 2013:

• 6% coupon

5-year US$2.25bn RCF extended to Oct 2018:

• US$1,142m drawn at Sep 2014
• US$800m fixed at 4.3% all-in until March 2016
• Floating interest of 1.75% + 1 month LIBOR

Debt

Increased 55% YoY from ZAR507m to ZAR787m

Net interest paid on loans

SSA: 15-yr lease effective Dec 2009

• Cost ~US$40m p.a.

SA: 15-yr agreement effective Sep 2012

• Cost ~US$42m p.a.

New Transponder: 15-yr agreement effective Jan 2017

• Cost ~US$55m p.a

Transponders

Sep 13 ZARm Sep 14 ZARm Interest (paid) (1,055) (1,332) Loans and overdrafts (749) (963) Transponder leases (173) (182) Other (133) (187) Interest received 257 206 Loans and call accounts 242 176 Other 15 30 Other finance costs, net (117) (82) FX translation adjustments (165) (111) BEE preference dividends 48 29 Total finance costs (915) (1,208) 49

Taxation analysis

Sep 13 ZARm Sep 14 ZARm Profit before tax 4,870 11,024 Add back: Development spend* 2,898 4,025 Equity results (including impairments) (4,386) (9,932) Other gains and losses 958 124 Acquisition gains 222 (47) FX gains and losses 165 111 BEE preference dividends (48) (29) Adjusted profit before tax 4,679 5,276 Tax charge (1,447) (1,755) Effective rate 31% 33% 50

* No deferred tax assets currently being raised on assessed losses

Capital expenditure

1H FY15 split by business

Sep 13 ZARm Sep 14 ZARm Land, buildings & plant 264 257 Transmission equipment 1,217 548 Computer, software & network equipment 429 445 Other (including vehicles, furniture) 68 206 Capital expenditure 1,978 1,456 Capex/Revenue 7% 4%

278 1,008 170 Ecommerce (19%) Pay TV (69%) Print (12%)

51

Current assets and liabilities

Current assets Sep 13 ZARm Sep 14 ZARm Inventory 2,486 4,204 Programme and film rights 3,147 3,955 Trade receivables 5,007 4,983 Other receivables 3,530 10,518 Derivative financial assets 501 219 Cash and deposits 16,262 12,061 Assets held for sale 32 584 Total 30,965 36,524 Current liabilities Sep 13 ZARm Sep 14 ZARm Current portion of long-term debt 2,192 2,826 Provisions 228 283 Trade payable 5,669 6,448 Accrued expenses and other 11,318 19,587 Tax payable 699 659 Derivative financial liabilities 875 842 Bank overdraft and call loans 1,577 1,306 Liabilities held for cash

• 9

Total 22,558 31,960 52

M&A activity

Total acquisition spend (US$m)

754 260 634 465

• 200

400 600 800 Mar 11 Mar 12 Mar 13 Mar 14 Sep 14

Other

369 53

Pay-TV operational metrics

Capital expenditure (ZARm) Programming cost (ZARm) Free cash flow (ZARm) Net additions (‘000) Digital subscriber mix 1H FY15 revenue split

684 394 734 521 800 342 Mar 12 Sep 12 Mar 13 Sep 13 Mar 14 Sep 14

1 159 1,187 2,030 3,720 1,687 1,008

Mar 11 Mar 12 Mar 13 Mar 14 Sep 13 Sep 14

40% CAGR 48%

36% 41% 33% 32% 31% 27% Sep 13 Sep 14 Premium Compact Lower-end

5,497 6,037 6,935 8,213 3,943 4,682

Mar 11 Mar 12 Mar 13 Mar 14 Sep 13 Sep 14

19%

3,239 4,123 4,486 3,010 2,022 1,771

Mar 11 Mar 12 Mar 13 Mar 14 Sep 13 Sep 14

12% CAGR 14%

54

Subscription (81%) Advertising (7%) Hardware sales (5%) Online/Broadband (4%) Other (3%)

Print media:

Capex trend ZARm* Sep 13 Sep 14 % Change Revenue 3,951 3,965

• Trading profit

242 92

• 62%

Trading margin 6% 2%

*Data for 1H FY15 reflect Media24’s stand-alone results available on www.media24.com

Advertising (30%) Printing (31%) Circulation (20%) Books (6%) Other (9%) Distribution (4%)

Revenue mix 1H FY15

348 360 302 428 223 155

Mar 11 Mar 12 Mar 13 Mar 14 Sep 13 Sep 14

Operations

Tough trading conditions persist Retained market leadership in newspapers and magazines – continued focus on efficiencies Paarl Media built out capacity and expanded into new market segments 24.com strengthened its position as leading digital publisher in Africa Spree enjoys leading position in online fashion and launched new categories

Financials

Margins contracted due to:

• lower print media revenues
• accelerated investment in digital initiatives
• expansion into new areas to diversify revenues

Printing revenue +10%, driven by new acquisitions Book publishing -30% YoY, due to lower schoolbook

• rders than budgeted

Advertising revenue -8% YoY 55

*Organogram depicts major brands

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Glossary of terms

B2C: Business to Consumer C2C: Consumer to Consumer DTH: Direct-to-Home Television DTT: Digital Terrestrial Television EPS: Earnings per Share FCF: Free Cash Flow FEC: Forward Exchange Contract GMV: Gross Merchandise Value HEPS: Headline Earnings per Share HD: High Definition IM: Instant Messaging ISP: Internet Service Provider IVAS: Internet Value-Added Services JV: Joint Venture M&A: Mergers and Acquisitions MMO: Massively Multiplayer Online NNL: Net New Listings O2O: Online to Offline OCS: Online Comparison Shopping PV: Page Views PVR: Personal Video Recorder ROI: Return on Investment SSA: Sub-Saharan Africa VOD: Video-On-Demand 57

Investor Relations

Meloy Horn Office: +27 11 289 3320 Mobile: +27 82 7727 123 E-mail: InvestorRelations@naspers.com Website: www.naspers.com

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