26 November, 2009
UPDATE 3-Naspers pins hopes on Internet unit, H1 profit up
* China web frenzy leads the way
* H1 core headline EPS up 36 pct
* Loses English Premier League rights in Nigeria
* CEO denies in talks with AOL to buy ICQ
* Shares down 1.44 pct, in line with broader mkt (Adds CEO denial of ICQ talks)
By Tiisetso Motsoeneng
JOHANNESBURG, Nov 26 (Reuters) - Africa's biggest media group, Naspers (NPNJn.J), rode the breakneck rise of its Chinese Internet portal Tencent to lift half year earnings and pinned hopes for future growth on its online business.
Tencent (0700.HK), in which Naspers holds a 46.5 pct stake, nearly doubled revenue to 2.1 billion rand ($285 million) as a growing number of web users surfed its range of instant messaging, e-mail, search and online gaming services. [ID:nHKG316200]
"We will continue growing our internet operations organically and through acquisitions," Naspers CEO Koos Bekker said. "We also expect to accelerate investment in new products and services over the next six months."
But he denied reports the firm was in talks to buy US-based instant messaging unit ICQ from AOL AOL.N.
China's recent roll out of 3G mobile services is creating a land grab among Internet firms for slice of a mobile Internet market the size of the U.S. and Europe combined. [ID:nHKG166404]
Naspers, which bought 91 percent of Brazil's e-commerce group BuscaPe for about $342 million, has net cash of 2.4 billion rand ($325.7 million), which it said was largely to fund acquisitions.
Naspers said core headline earnings per share, its main profit gauge, increased 36 percent to 648 cents in the six months to end-September, also helped by robust performance from its pay-TV unit.
"The TV margins are surprisingly good. It performed very well in a tough economic environment," said Jan Meintjes, an analyst at Gryphon Asset Management.
The pay-TV unit lifted its customer base by 11 percent to 3.7 million rand across Africa but the company said it expected margins to come under pressure due higher programming costs.
"Live sport, in particular is becoming very expensive," Naspers Financial Director Steve Pacak said in a statement.
SOCCER RIGHTS
Naspers said it has lost English Premier League rights in Nigeria but secured the rights for the rest of Africa for the three seasons starting in August next year.
In a conference call, Bekker denied media reports in South Africa and the United States that the company was talking to AOL AOL.N to buy the US-based instant messaging unit ICQ.
"We're not interested ... Over the last couple of years the business has been losing some of its users. We're not sure that it would really add value," Bekker said.
Shares in Naspers fell 1.44 percent to 286.56 rand, in line with the JSE Top-40 index of blue chips .JTOPI.
"I wouldn't read too much into the share price. I don't think it reflects how the market views the results, the market is weak in general," said Gryphon Asset Management's Meintjes.
Naspers, which also operates in Russia, the Netherlands, India and Thailand, said revenue rose 6 percent to 13.5 billion rand ($1.83 billion).
But the company said its print media business was under pressure as slower consumer spending in South Africa hit advertising revenue.
"Cost-cutting remains a focus (in the print media business)," the group said.
(Editing by John Stonestreet)
((tiisetso.motsoeneng@thomsonreuters.com; +27 11 775 3122 Reuters Messaging: tiisetso.motsoeneng.reuters.com@reuters.net)) (For more Africa cover visit: af.reuters.com/ -- To comment on this story email: SouthAfrica.Newsroom@reuters.com) ($1=7.368 Rand)
Source: http://www.reuters.com
UPDATE 3-Naspers pins hopes on Internet unit, H1 profit up Added: (26.11.2009)
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