CANAL+, the pay-TV group that now owns MultiChoice and with it DStv, published its numbers for the nine months to September on Thursday. Revenue for the period rose 37.5%, to about €6.4 billion.
Most of that jump is the purchase itself. When one company buys another, its revenue grows by whatever the new business was already bringing in, so CANAL+ also gives a like-for-like figure that compares the same set of businesses in both years. Showmax, which was shut down in Africa at the end of April, is left out of the figures entirely. Measured like for like, group revenue was flat, slipping 0.3%.
CANAL+ expects more from the deal than a bigger revenue line. Daily Investor reports that it is counting on the gains from combining the two businesses to add €250 million to earnings and €220 million to free cash flow, the money left once the bills and investment are paid.
Where DStv went backwards
MultiChoice on its own is the less flattering part. Its reported revenue edged up 0.4%, and only because exchange rates gave it a big helping hand. Like for like, it fell 3.0%.
The reason is close to home. CANAL+ puts the fall down to lower subscription revenue in South Africa, partly offset by growth in most of MultiChoice's other English-speaking countries. It gives no subscriber numbers, only that the money coming in from South African subscriptions went down. The World Cup lifted the subscriber base in the first half, and CANAL+ says it settled back to normal in the third quarter.
The rest of CANAL+'s African and Asian business is where the organic growth is. Leave MultiChoice out and that region grew 10.2% like for like. Chief executive Maxime Saada pointed to "strong momentum in French-speaking Africa and at STUDIOCANAL", the group's film studio.
A simpler DStv, at the same price
CANAL+'s answer for South Africa arrived in September. Saada calls it "a new, simplified value proposition", which in plainer words is a simpler set of offers that gives subscribers "more content, greater choice, and better value for the same price". The same offers will roll out across the rest of English- and Portuguese-speaking Africa over the coming months.
September was the last month of the period, so these numbers barely include the new offer. The fourth quarter is the first full one in which South African subscribers get to show what they make of it.
