Most of Naspers’ 2022 Revenue Comes From E-commerce.
Naspers’ rapidly expanding e-commerce portfolio continues to shine in fiscal 2022.
According to Statista, the number of individuals making internet purchases will reach 2.14 billion in 2021, resulting in Naspers’ e-commerce outperforming the rest of the world.
The Cape Town-based internet giant says its e-commerce businesses were resilient this year, growing sales in the second half of the year and surpassing worldwide peers in several cases.
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Naspers released its annual financial results yesterday, stating that the e-commerce segment’s revenue increased by 56% (49%) to $10.7 billion and was a substantial contributor to group revenue growth of 24% (24%) to $36.7 billion. (Percentages in brackets show local currency growth excluding mergers & acquisitions.)
In terms of major financial measures for the year, core headline earnings were $2.1 billion, a 40% (16%) decrease due to the sale of a 2% stake in Tencent and Tencent’s lower contribution to core due to higher losses from its associates.
Headline earnings fell by $2.5 billion to $1.6 billion, but overall sales climbed by $2 billion, or 34% (37%), from $5.9 billion to $7.9 billion on a consolidated basis.
“Within our e-commerce portfolio, all segments made good progress against their financial and strategic objectives. Classifieds demonstrated healthy growth at its core, well ahead of global peers. OLX Autos experienced strong triple-digit growth this year, as it creates a differentiated customer experience. Our classifieds business has been deeply impacted by Russia’s invasion of Ukraine. We are appalled by the war in Ukraine and we continue to do all we can for our Ukrainian employees and the people of Ukraine. Consequently, in March 2022, we announced the separation of the Russian classifieds business Avito from our OLX Group,” Bob van Dijk, group CEO of Prosus and Naspers, said.
Naspers has since begun looking for a suitable purchaser for its Avito shares.
In terms of food delivery, the company claims that this area of the business remained robust during the year “because it serves a critical consumer need that is being fundamentally altered by technology.”
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“We are leveraging our logistics network and capabilities, as well as our strong customer relationships, to pursue this opportunity with a real competitive advantage. The online food and convenience industry is still in its early stages of development, and we are excited by its long-term prospects, and we believe it will ultimately yield a good return on investment,” explained Van Dijk.
Naspers said its payments and fintech unit’s global growth momentum has persisted.
“We increased our scale in India, one of the fastest-growing consumer internet markets, and the closing of the acquisition of BillDesk will create further opportunity to expand into credit and digital banking. Outside of India, the business continued to grow strongly,” said Van Dijk.
In August of last year, the company paid $4.7 billion for the acquisition of Indian digital payments platform BillDesk.
It said at the time that the acquisition will help PayU, a Naspers and Prosus fintech business that operates in more than 20 high-growth areas, become one of the world’s largest online payment providers by total payment volume.
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PayU focuses on local and international payments, credit solutions for individuals and small enterprises, and strategic investments in emerging fintech firms.
Furthermore, the edtech unit’s performance remained excellent during the review period, and Naspers claims to have made significant progress in extending the portfolio through acquisitions of market leaders in its areas of focus.
Van Dijk explained: “During the year, we took a substantial stake in Skillsoft, which is now public, while acquiring Stack Overflow and GoodHabitz. This positions us well within the key enterprise education market. Our edtech investments currently reach over 500 million users and cover the full span of the sector, from kindergarten through to grade 12 (K-12) and beyond, into third- and enterprise-level education.”
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Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
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