Earnings call: MultiChoice reports growth amidst economic challenges

MultiChoice Group Ltd (MCG), the African entertainment company, has reported substantial growth and resilience in its FY '24 results, despite economic headwinds and currency pressures. During the earnings call, CEO Calvo Mawela emphasized the company's strategic pivot from traditional linear video entertainment to digital streaming and interactive services. The relaunch of Showmax, MultiChoice's streaming service, in February led to a significant increase in subscribers in March.

Although the company saw a decline in active subscribers, particularly in South Africa and Nigeria, it managed to deliver strong financial performance with a 26% trading margin in South Africa and increased profitability in the rest of Africa. However, adjusted core headline earnings dropped by 20% to ZAR1.3 billion, primarily due to lower trading profit and investment in Showmax.

Key Takeaways

• MultiChoice maintained a stable subscriber base and solid cash flow despite economic and power supply disruptions.
• Showmax relaunch contributed to record-breaking subscriber growth in March.
• Investment in local content exceeded 6,500 hours, with a focus on sports coverage.
• DStv Stream active customers increased by 139% since July.
• Nemesis insurance business and DStv Internet saw substantial growth in active policies and revenue.
• MultiChoice achieved cost savings of ZAR1.9 billion, surpassing the target of ZAR800 million.
• Foreign exchange losses amounted to ZAR4.5 billion due to currency depreciation.
• The company plans to focus on accelerating growth of digital products, including Showmax and other ventures.

Company Outlook

• MultiChoice aims to reduce costs by ZAR2 billion in the next year.
• The company is focusing on scaling Showmax, SuperSportBet, DStv's Insurance and Internet businesses, and Moment's B2C payments platform.
• MultiChoice did not provide specific Showmax revenue guidance for FY '25 or a timeline for reaching the billion-dollar revenue target.
• Pricing strategies are set to counteract the impact of inflation, with no detailed information on future adjustments.

Bearish Highlights

• MultiChoice reported a decline in active subscribers across key markets.
• The company faced significant foreign exchange losses due to currency depreciation.
• Adjusted core headline earnings declined by 20% to ZAR1.3 billion.
• The negative equity balance stood at ZAR1.1 billion due to non-cash accounting adjustments.
• Free cash flow was impacted by lower profitability and investments in Showmax.

Bullish Highlights

• Showmax's relaunch led to a surge in subscriber growth.
• DStv Stream, Nemesis, and DStv Internet reported strong performance.
• The company's sports betting business, KingMakers, delivered positive operating momentum.
• Irdeto saw revenue growth in connected industries.
• MultiChoice achieved a 26% trading margin in South Africa and increased profitability in the rest of Africa.

Misses

• Revenue declined 5% on a reported basis due to weaker currencies.
• Core headline earnings, excluding losses on cash remittances, decreased by 38%.
• The company terminated the tech modernization project, resulting in a ZAR1.2 billion write-off.

Q&A Highlights

• MultiChoice discussed cost-saving measures, including renegotiating satellite contracts and the closure of the TechMod program.
• Showmax costs are expected to stabilize in FY '25, with a break-even target by the end of '27.
• The company plans to align pricing with inflation and believes its content provides good value.
• MultiChoice is in ongoing discussions with Canal+ regarding regulatory issues and has invested in Bidstack.

In summary, MultiChoice Group Ltd has demonstrated adaptability and strategic growth in challenging economic conditions. The company continues to invest in its digital transformation, focusing on streaming services and interactive platforms to ensure it remains the leading entertainment platform in Africa. Despite the obstacles, MultiChoice's efforts in local content production, sports coverage, and digital product growth position it well for future opportunities in the African market.

InvestingPro Insights

MultiChoice Group Ltd (MCG) has shown a dynamic performance recently, and a deeper analysis using InvestingPro metrics can provide a clearer picture of the company's financial health and market position. As of the last twelve months leading up to Q4 2024, MCG has a market capitalization of approximately $2.46 billion. This valuation comes despite the company not being profitable over the past year, with a reported P/E ratio of -11.68, indicating investor expectations of future earnings growth.

InvestingPro Tips suggest that the stock is currently in oversold territory, which could interest value investors looking for potential rebounds. Additionally, MCG is recognized as a prominent player in the Media industry, which may contribute to investor confidence in the company's market share and strategic direction, especially as it pivots more towards digital streaming services.

In terms of financial performance, MCG's Price / Book ratio stands at a high 9.18, reflecting a premium that investors are willing to pay for the company's net assets, potentially due to the company's strategic initiatives and market position. Analysts predict that despite recent non-profitability, the company will turn profitable this year, providing a positive outlook for potential investors.

For those interested in further analysis, InvestingPro offers additional insights and metrics. By using the coupon code PRONEWS24, readers can get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, gaining access to a wealth of financial information and expert analysis to guide their investment decisions. There are 6 more InvestingPro Tips available for MultiChoice Group Ltd, which can be explored for a more comprehensive understanding of the company's prospects.

Full transcript - MultiChoice ADR (MCHOY) Q4 2024:

Meloy Horn: Hello, everybody, and welcome to the MultiChoice FY '24 Results Call. This is Meloy Horn, and on behalf of the Group, I'd like to welcome you and also introduce the representatives of MultiChoice. With me on the call today is our CEO, Calvo Mawela; and our CFO, Tim Jacobs. I also would like to, before we proceed, just acknowledge Chris Estereza (ph), who has walked this journey with us for many, many years, as moderator of our results calls. Chris sadly passed away recently and may his soul rest in peace. We're sorry to his colleagues and his family for your deep loss. So, to start today's proceedings, we'd like to play you a video to remind you what we're all about. And thereafter, Calvo will start his presentation. Thank you very much. [Video Presentation]

Calvo Mawela: Good afternoon, everyone, and welcome to our results presentation. To start, let's turn to Slide 5. I want to begin by thanking all our teams at MultiChoice for their continued commitment to our vision of enriching the lives of millions of people through entertainment and technology. We have long held this view and in recent years have carefully invested in our strategy of enabling our customers to stay within our platform, while enjoying the services and products they need beyond just video entertainment. We continue to innovate partner, and invest to grow from our core linear video business by developing and scaling adjacent streaming and interactive entertainment services. Simply put, for our customers, it means Africa's most loved storyteller is fast becoming the entertainment platform of choice. We like to imagine this as concentric circles around our customers, a platform catering for their entertainment needs, from financial services that allow them to afford and pay for their entertainment to the technologies required for access, and of course, a choice of video and interactive entertainment options which our customers can enjoy in their homes or increasingly in their hands. The increased penetration of smartphones is changing how we consume and engage with content. We see this as an opportunity to increase our presence beyond the current 21 million households and into countless more hands across Africa. This is what the strategy looks like for us as a business, but for MultiChoice customers, our strategy means we are catering for their entertainment needs, whether they are in their homes or on the move. With DStv as your home of entertainment and the ultimate aggregator, we bring you a lean back experience with the option to stream, one place to browse, buy and consume all your content across all your devices. Through Showmax, we are bringing you a stream focused service with great local originals and the best of international content as well as mobile only Premier League sports. All are available to you anytime, anywhere. With this reminder of our strategy, let's turn to Slide 7 to focus on our progress. Our results for financial year 2024 demonstrate a resilient Group performance in challenging macro conditions. They also highlight our ambitions as reflected in the success of the new growth initiatives where clear strategic milestones were achieved. Despite a ForEx impact of over ZAR4 billion, which is more than the last four years combined, we have delivered a trading profit margin of 26% in our South African business and maintained positive trading profit for our business in the rest of Africa for the second consecutive year. Our teams deserve special thanks for delivering close to ZAR2 billion in cost savings, in addition to reducing Decoder subsidies by more than ZAR1.5 billion, allowing us to navigate the current macro environment and safeguard cash generation. This solid results in our more mature operations provide the foundation we need to confidently drive growth opportunities in places like Showmax, Moment, and SuperSportBet, which have now all progressed from being strategic ambitions to revenue-generating businesses with great growth prospects. The Showmax story is particularly exciting, and Slide 8 shows us why this past year was a pivotal year for Showmax. Having officially concluded the partnership with Comcast (NASDAQ:CMCSA) in April 2023, the long awaited relaunch took place in February this year. The launch included several notable achievements. We successfully launched across 44 markets on the continent, initially focusing our marketing efforts on South Africa and Nigeria, with markets like Kenya and Ethiopia to follow. We transitioned the entire tech stack to Peacock's world class platform and customized it for localized requirements like the support for low bandwidth devices and data saving functionality. We partnered with telco operators to provide our customers with maximum entertainment for minimum data cost. We migrated almost 100% of the eligible customer base to the new Showmax platform and 88% of those migrated had reactivated their accounts in the seven weeks to year-end and we enjoyed record breaking subscriber growth in the month of March. Key to the early Showmax success has not only been its world class platform and user interface, but also its valuable partners, incredible content, and great pricing. During the year, Showmax ramped-up its local content streaming to 59 originals, popular shows that drove viewership into the Tracking Thabo Bester, The Mommy Club, Adulting, and Real Housewives. This is the beginning for the new Showmax and the positive impact it will have on our business. We look forward to sharing more successes as our streaming journey continues. Showmax and all our entertainment services benefit from our Group's ongoing and increasing investment in African content, which our customers greatly value. We are the largest producer of original content on the African continent, increasing our investment at a time when most international streamers seem to be slowing down their investment outside of their core markets. At the same time, we continue to license some of the best international content globally through our long-term content partners. But let's turn to Page 9 for more on content. We produced in excess of 6,500 hours of local content again this year, accounting for over half of our general entertainment spend, and our local content library now has up to over 84,000 hours of content, 12% more than last year. Six years in the making, Shaka Ilembe was the highlight of the year and became Africa's biggest TV series ever. Shot entirely on location in South Africa, this epic production was created through the skills of over 8,000 people and watched by millions. Across Africa, we launched three new proprietary channels in Ethiopia, Uganda, and Mozambique, while also producing content in Africa's fourth most spoken language, Oromo. In addition, we unveiled a supercharged Africa Magic offering. We continue to leverage popular shows like The River, Gqeberha, and Sibongile & The Dlaminis, and we re-engage, re-energize our youth content slate with Youngins, Wyfie, and Roomies, all of these in a targeted effort to meet the growing demand of audiences for local content. Investment in local content directly or through co-productions, will continue as one of our key differentiators, the other being sport, which we cover on Slide 10. SuperSport's headline broadcast during the year included the men's Rugby World Cup in France, the men's Cricket World Cup in India, AFCON, the FIFA women's World Cup in New Zealand and Australia, as well as the women's Netball World Cup in Cape Town. We also hosted the second SA20 cricket season, with peak audiences increasing a fair 35% from the great success last year. The FY '24 renewal cycle was a successful one. Given our track record in successful delivery, we were able to renew access to popular sports events to continue to add value to our subscribers and differentiate our services. Popular renewals included the Champions League, SA Rugby, IPL Cricket, the Tour de France, the PGA Tour, and UFC, to name a few. All of these ensure we continue delighting our customers with arguably more live sport than any broadcaster in the world. We offer over 34,000 live events to choose from, including an 8% increase in local sport content, and it's no wonder that over 30 million customers follow us on social media for their sporting news and highlights. Through SuperSport and our partners, we are truly a world of champions. Turning to Slide 11, I want to end my strategic overview on two key initiatives that I am particularly proud of. The first ever all-women crew to cover a global sporting event, the women's Netball World Cup. As part of our Here For Her campaign, it reflects our focus on growing the coverage, support, and popularity of Women's sport across Africa. Our SuperSport Schools business is also going from strength to strength. This year saw us doubling the registered base, displaying more than 49,000 hours of live programming across 43 different sporting codes, covering 900 sports festivals, more than 1,100 schools, and over 14,500 teams. As you can see, content is truly at the heart of what we do. Bringing our customers the best in local and global general entertainment and sport available in their homes and in their hands across the continent sets MultiChoice apart from its competitors. True to our vision, we continue enriching lives through entertainment and technology. So, let's turn to Slide 13 for a closer look at the performance of our various businesses. This year has been like no other in terms of economic turmoil, and we are not alone in feeling the challenges of a down cycle and weaker consumer environment. Loadshedding in South Africa remained a key challenge in the past year. Not only did we experience more loadshedding days, but also higher levels as the chart on the right shows. The negative impact on our business and its revenues cannot be underestimated, something we clearly saw through the pickup in subscribers' activity in April and May this year as we enjoyed an extended period of no disruptions. Against the backdrop of high inflation and interest rates, the rising cost of living, and disrupted power supply, we had to navigate carefully balancing decisions to safeguard cash and profitability with the need to future proof our business by investing in new opportunities. Our strategy reflects the need to cater for the challenging consumer habits in the world of video entertainment. Younger customers moving to streaming or seeking additional interactive entertainment while they watch their favorite sport are just two examples. To us, it seems that the tougher economic climate may have accelerated some of these changing preferences, making it even more important that we move ahead of the times. At the moment, it is quite hard to tell exactly which trends are cyclical and which ones are structural, but the one thing we know for sure is that nobody else has the variety of content we have for the customers we serve. This, coupled with our research capability and years of experience puts us in a great position to understand their entertainment choices, to identify their needs, and ultimately, to tap into additional growth opportunities. The graph on Slide 14 reflects our strategic ambitions around these opportunities, to build a portfolio of digital products layered on top of the traditional linear base, to drive ongoing top line growth at a time when the linear business in South Africa is starting to mature. Our strategy to grow these additional revenues is no longer only a vision, it is gaining real traction. We are in the fortunate position that we don't have to choose between linear and streaming. In some markets where broadband and data is more readily available, streaming will continue to grow, and in others, our linear offering remains the cheapest option to watch video. At MultiChoice, we continue to deliver entertainment options and supporting services aimed at being Africa's entertainment platform of choice. Turning to Slide 15. Although, linear pay-TV is maturing globally and also in South Africa, it remains the mainstay of our operations. It is therefore critically important that we safeguard this business which provides a solid cash generating business from which to launch new services. We are pleased that the initiatives implemented by the South African leadership team to drive retention of the premium bouquet are paying off. Although the subscriber trend is still downward, it is decelerating and trending toward stability as you can see in the top left graph. Below that, the graph at the bottom left shows the positive impact of the team's decision to recalibrate the pricing and value proposition of the DStv Business Play packages. This led to a 32% increase when comparing the monthly revenues in August before the change with those in March, and was an important underpinning to the revenue growth in DStv Commercial. The middle graph at the top reflects DStv Stream's great traction since its relaunch with active customers up 139% since July last year. The biggest benefit is that over 90% of the DStv Stream subscribers added in the period are new subscribers who have not subscribed to our services before. Extra Stream, which solves the one-stream limitation via mobile, was launched with great success early this year. This gives us confidence to launch our new proximity control option later on, which is set to offer additional streams within a household. Nemesis, our insurance business continues to enjoy strong growth with active policies increasing a healthy 19% to 3.3 million. This segment reported an impressive 35% increase in revenue, just shy of the ZAR1 billion mark. We are also pleased with the ongoing traction of DStv Internet, which almost doubled its customer base and reported a very pleasing 160% growth in revenue year-on-year. Slide 16 shows the key KPIs of our South African linear business. We have already discussed the impact of weak macro and loadshedding on our business, resulting in increased pressure on subscriber number, activity, and viewership. Due to a strong focus on retention, the decline in active subscribers in South Africa was limited to 5% and the active base now stands at 7.6 million households. As a Group, we have largely focused on the 90-day subscriber metric since listing in order to provide a subscriber number that looks through the monthly volatility in the base. However, management is increasingly managing the business on the basis of active subscribers to optimize retention and activity rates from month to month in a low growth environment. As a result, our commentaries now focus on active subscribers, but we still provide the 90-day active subscriber numbers in our impaired mix for continuity. Although, the Premium bouquet is trending towards a stable base, given the targeted retention efforts, the premium customer tier, which includes the Premium and Compact Plus bouquet was again dragged down by the pressure on the Compact Plus base, which is much more susceptible to macroeconomic pressures. The mid-market Compact base, which is most exposed to the macroeconomic challenges was down 9%, while the mass market tier was 2% lower due to pressure in the family base, the impact of low trading, and reduced decoder subsidies. Despite a decline in active days, ARPU held stable at ZAR281, benefiting from average price increases of 5.6% following inflation. The past year presented the toughest set of macroeconomic conditions for the rest of Africa's business since 2016. In February, the official and parallel naira rates reached peaks of NGN1,600 and NGN1,900 to the U.S. dollar, respectively, with several other African markets also subject to extreme currency depreciation. The teams in the rest of Africa stepped up to the challenge of maintaining profitability by implementing revenue supporting measures and technical savings. This included the launch of Family Plus in Angola, with stronger content to entice upgrades, forming partnerships with Telcos to drive the streaming base and delivering strong festive campaigns. The launch of GOtv Super Plus in August provided DTC subscribers with the same value and price as the DStv Compact offering. This package gained great traction, providing ARPU support of around $5 to $6 more per subscription and the prospect of a multi-million dollar revenue uplift in the year ahead. To account for a high inflation environment, we increased prices across the region by 27% on a weighted average basis. Although, our general policy is to increase prices only once a year, the acute currency challenges have forced us to push through two price increases in four of our African markets. The team also implemented specific initiatives to reduce costs, especially around decoder subsidies. Given the ramp-up in decoder subsidies last year around the FIFA World Cup and taking the current macro dynamics into account, it made sense to scale back. To safeguard cash generation, we removed subsidies in Nigeria and Angola altogether. We also saved on content and other general costs, which allowed us to deliver a trading profit of ZAR1.3 billion. In a year that follows a FIFA World Cup year, especially one like last year, when we added 1.4 million customers, some downward pressure on subscriber growth is to be expected. But the drop of 15% this year was more severe, resulting in a closing base of 8.1 million active customers at the end of March. While the mid-market was up 13%, the mass market base dropped 20%, hit by a macro turmoil and cost of living crisis across Africa, but predominantly in Nigeria. Active days were down 17 days, not only because customers are taking savings, but also as a result of power outages in Nigeria, Zambia, and Zimbabwe, impacting on their ability to watch television. Blended output came in just above $9. We responded well to the challenges and kept this segment profitable. In the short term, these challenges are likely to remain, but over the long term, we retain our belief that Africa represents a significant growth opportunity for us. Slide 19 reflects on the performance of KingMakers, our 49%-owned sport betting business. Despite the impact of a challenging macro environment in Nigeria, KingMakers continued to deliver positive underlying operating momentum. The online business in Nigeria grew strongly, with monthly active users up 37% year-on-year, and online gross gaming revenues up 26% year-on-year in constant currency. While the agency business was more affected by the economic condition, the business delivered organic revenue growth of 5%. On a reported basis, revenues came to $147 million and delivered an EBITDA profit of $2 million. The product and market expansion plans remain fully funded, with KingMakers retaining a cash balance of $113 million at the end of December 2023. KingMakers launched the SuperSportBet business in South Africa in January 2024. Its pre-game shows and live feed integration with SuperPix, as well as the Playbook preview show were key drivers for uptake and user engagement. Growth was further supported by SuperSportBet becoming the official betting partner of local soccer clubs Keza Chiefs and Orlando Pirates. On Slide 20, we reflect on Irdeto, which has now become the global market leader in managed security services for video, with a 22% market share. Strong execution and new customer wins has allowed it to more than double its market share over the past seven years. This year, Irdeto also had significant success in combating piracy, which is rising globally, especially in the streaming space. Outside of media security, Irdeto's solutions for connected industries are building momentum. Shipping its first keyless solutions to one of the largest fleet operators in the U.S. market has resulted in the connected transport division more than doubling its revenues. Supported further by innovative solutions for the online gaming industry, revenues from new services lines increased to 35.7%. Overall revenues increased 17% year-on-year and the trading profit margin came to 23%, so a good performance all around by Irdeto. After being founded the year before, Moment launched its operations this year and is rapidly gaining traction. Having reached a milestone of processing $85 million in payment volumes year-to-date by the end of March, the number has increased to more than $215 million by early June. Moment played a vital role in the recent Showmax relaunch, stepping up to fill in a critical payment gap by taking local and cross-border card payments in 44 markets. Not only is it supporting Showmax, but in January this year, Moment also started taking up payment volumes for DStv. It already accounts for a significant share of payment volumes, which enables seamless payments for customers and more savings for us. Today, Moment already accounts for more than 30% of DStv's payment volumes, enabling more seamless payments for customers and saving us money at the same time. In a busy year for women, they secured critical licenses in South Africa, with more underway, and they built an extensive Pan-African network that will be enabled for our use in the coming year. Along with other funding backers, we recently contributed $8 million to Moment's C-plus funding round, in which they raised $22 million of funding at a post-money valuation of $82 million. Our stake in the business is 26%. That concludes our operational overview. I'm incredibly proud of the achievement of our business over the last year, especially considering the magnitude of external challenges that we had to counter. The teams did an excellent job to manage things under their control, deliver for our customers, and grow our new initiatives. I'd like to invite Tim, our CFO, to take you through our detailed financial results.

Tim Jacobs: Thank you, Calvo. The past financial year has been a tough one on the macroeconomic and, in particular, currency front for many businesses globally. However, our team showed resilience, and we were able to execute very well on things under our control. We made the necessary interventions, not only to see us through this challenging period, but also to position us well for the years ahead. The benefits of right-sizing the business will stand us in good stead once economies start recovering and currencies start stabilizing. On Slide 23, I would like to start with the four key financial highlights. In South Africa, we delivered a 26% trading margin, well within the mid-20%s guided range. This was despite substantial pressure on the top-line caused by consumer weakness and the fact that we are predominantly a fixed-cost business. In the rest of Africa, we were able to increase the trading profit from ZAR900 million last year to ZAR1.3 billion, and maintain profitability for the second consecutive year. This is a very strong performance if one considers the significant currency pressures, which I'll discuss shortly. These profits came as a result of our team's delivering cost savings of ZAR1.9 billion. This is the highest savings amount since listing, well above our original full year target of ZAR800 million, and the revised stretch target of ZAR1 billion set at the interim stage. In a year where we focused more on retention than growth due to economic conditions, we made tactical decisions to reduce our spending on decoder subsidies. By raising decoder prices and unbundling content from our sales offers, we were able to save an additional ZAR1.5 billion. I will unpack this in more detail later on. Turning to Slide 24, we were able to grow our trading profit of our core business by 38% before the impact of additional investment in Showmax and currencies. The waterfall chart in this page provides a high-level view of the various elements that impacted our trading profit performance. Looking at these from left to right, in the comparative period, we generated ZAR10 billion in trading profit. Through pricing discipline, tactical trade-offs between subsidy and growth, and a relentless cost discipline, we have delivered a ZAR3.8 billion organic improvement in the core business. We invested an incremental ZAR1.4 billion into our new Showmax business, which comprised customizing the new Peacock platform, hiring key staff to fill the new structure, developing our new brand, and marketing for the relaunch. We are happy to make this investment as directionally it is how consumers prefer to consume content globally, and will drive sustainable and long-term returns. This translated into an organic, comparable trading profit of ZAR12.4 billion, an increase of 24% over the prior year. Unfortunately, we experienced unprecedented depreciation of currencies across most of our core markets, resulting in ZAR4.5 billion in foreign exchange losses, which materially dampened our operational performance. After factoring this in, the reported trading profit closed 21% lower than last year at ZAR7.9 billion. With that context, we turn to Slide 25. As a business operating in 50 markets across the continent, we are typically affected by currency weakness every year. However, this year was quite different, and the graph reflects the sheer magnitude of the impact of foreign exchange losses on this year's results. In short, over the five years since our listing in 2019, we incurred cumulative foreign exchange losses amounting to ZAR4.3 billion. This is a sizable amount by any standards, but it pales into comparison to the ZAR4.5 billion loss that we had to absorb in this year. Importantly, it is against this background, combined with the high impact of inflation and interest rates, as well as power challenges on consumers, that we believe our financial year '24 results should be evaluated. Moving to Slide 26, and a recap on our headline numbers. The top-line improved 3% on organic braces, supported by a strong discipline around implementing inflation in price increases across our markets, offset by a decline in active subscribers as mass market customers in countries like South Africa and Nigeria prioritized basic necessities over entertainment. Revenue declined 5% on a reported basis, owing to the significantly weaker currencies across our core markets. On a trading profit level, we delivered strong organic growth in the core business, but as already explained, the end result on a reported basis was weaker due to the currency impact. Consequently, adjusted core headline earnings, the Board's revised measure of the underlying performance of the business, that now includes losses on cash remittances, declined by 20% to ZAR1.3 billion. Free cash flow was also impacted by lower profitability, which combined with the ZAR1.7 billion platform investment in Showmax, resulted in a material decline year-on-year. On Slide 27, we look at subscriber numbers and subscription fees, the largest contributor to our top-line. The chart on the left shows our active subscriber base, which was down 9% due to severe macro pressures that Calvo has already explained. Subscription revenues on the right were down 7% on a reported basis and up 2% organically. In South Africa, subscription income was 5% lower, as the benefits of price increases was offset by lower subscriber activity as reflected in the lower reported active days. In the rest of Africa, we benefited from a weighted average 27% price increase, which outweighed the impact of the decline in subscribers and yielded a 10% organic improvement. Local currency weakness in the rest of Africa impacted negatively on U.S. dollar revenues. However, when converting this to rand for reporting purposes, the weaker rand U.S. dollar rate provided an uplift. Momentum in Showmax revenues was impacted by the disruption relating to the relaunch of the business, including the discontinuation of products like Showmax Pro. Turning to Slide 28, we unpack our revenue performance by segment and type. The pressure on South Africa revenues due to loadshedding and consumer pressure has already been covered, as has the decline in the rest of Africa. Our technology business Irdeto experienced healthy growth of 7% on an organic basis or 17% on a reported basis, given the uplift of translating its U.S. dollar revenues into rands. This was due to improved OTT revenues, as well as strategic wins in the managed services space. Gaming and connected transport revenues also grew strongly, benefiting from a diversified portfolio of products and innovative solutions. Showmax delivered a 22% increase in revenues to ZAR1 billion. On the right-hand side, advertising revenues delivered organic growth of 3%, supported by the continued growth in the rest of Africa, and partially offset by the impact of a tough economic cycle in South Africa. On a reported basis, the impact of the significantly weaker naira shaved ZAR431 million off revenues and resulted in a decline of 7%. Nemesis, our insurance business, increased its premium income by a healthy 35% to almost ZAR1 billion. Other revenue increased due to the income from technical staff seconded to Peacock, as well as higher sub-license activity. This was offset by lower revenue from decoder sales, owing to our tactical decision to reduce subsidies. Slide 29 provides a summary of our segmental trading margins, some of which we already commented on. The South African trading margin came in at 26%. The 7% margin delivered by the rest of Africa reflects continued upward momentum and was a very strong result given the circumstances. Irdeto's margins normalized to 23% due to the non-recurrence of the FIFA World Cup. The business had to contend with $11 million less in high-margin Group revenues, while profits were also impacted by $3 million in restructuring costs, as it continues to right-size its operations for a changing media landscape. Trading losses in Showmax increased from ZAR1.2 billion to ZAR2.6 billion, all relating to additional investment in the re-launch. On Slide 30, we provide our standard trading profit bridge for the rest of Africa. The business enjoyed a substantial benefit from its disciplined approach to pricing by implementing inflation-linked increases across core markets. This year was particularly difficult with inflation running very high in large markets such as Nigeria and Angola. To preserve profitability and cash flows, we were forced to implement two price increases in four of our markets. The subscriber losses explained earlier had a negative ZAR1.4 billion impact. This was offset by management interventions that included ZAR500 million of cost savings and a reduction in decoder subsidies of ZAR1.6 billion. We also benefited from ZAR800 million in tax accruals released across several markets. The combined impact of all these efforts translated into a ZAR5.7 billion trading profit on an organic basis, representing a margin of 23%. Once the unprecedented ZAR4.3 billion impact from currency depreciation was factored in, the reported trading profit closed on ZAR1.3 billion, reflecting a 7% trading margin. Moving to Slide 31, where we analyze our operating leverage and cost savings. As you know, our objective is to generate positive operating leverage by ensuring that we keep the organic growth in operating expenditure below the growth in revenue. Through our active interventions, we managed to achieve a 4.3% positive operating leverage. A key underpin to this result was the ZAR3.4 billion in specific cost reductions. As part of our annual cost saving objective, we delivered ZAR1.9 billion in savings with a major step up in the second half. Major contributions to the savings came from renegotiated contracts for international general entertainment content and sports rights, as well as the reduced cost price of decoders negotiated with suppliers. In addition, we saved ZAR1.5 billion on decoder subsidies, some as a result of a normalization in volumes in a post FIFA World Cup year, but the bulk of it due to tactical decisions to reduce decoder subsidies across the board. Turning to Slide 32, let me explain this decision and its impact to you in more detail. With a number of currencies and key markets depreciating aggressively through the year, it was critical to rethink all of our spend and this included tactically reducing decoder subsidies. We also removed the fully installed option on the Explorer in South Africa and unbundled the sale of dish kits from the sale of decoders in our rest of Africa markets to allow customers to reduce the overall cost of equipment. We were able to drive better unit economics by negotiating lower purchase prices with our suppliers this year. Combining decoder savings generated in the general course of business following elevated subsidies for the FIFA World Cup last year and those from our tactical strategic decisions resulted in a net benefit to the Group of ZAR2.2 billion. The successful relaunch of our DStv stream product means that customers now have access to DStv at a more affordable price point and without the need for decoders. This lower cost has resulted in new streaming customers accounting for a much larger share of new customers in South Africa as we show in the middle graph on the top row and ultimately this also helps to reduce decoder subsidies. The graph below it shows the reduction in the level of replacement boxes sold in South Africa from 55% in the prior year to 46% this year. This means a higher percentage of our boxes are going to new customers which drives incremental revenue rather than existing customers merely upgrading on a subsidized basis. Given the higher upfront costs due to lower decoder subsidies evidenced in the rest of Africa suggests that better quality customers are entering our platform. This is reflected in the top right graph in what we refer to as the resting equated percentage. It shows that measured on a three months after sign-up, 70% of subscribers on average tend to settle or rest on a higher bouquet compared to 59% in the previous three years. We are also seeing the early signs of a better quality of subscriber being acquired through improving survival rates also measured three months after sign-up. On Slide 33, we reflect on adjusted core headline earnings, the Board's revised measure of underlying performance which now includes the impact of the losses on cash remittances net of taxes and minorities. This metric reflects a decline of 20% year-on-year to ZAR1.3 billion, as substantially higher realized hedging gains and smaller losses on cash remittances were more than offset by lower trading profit. In financial year '23 we incurred losses on cash remittances of ZAR1.9 billion after minorities. This reduced to ZAR900 million in financial year 2024 due to a narrow gap between the official and parallel naira rates compared to the previous year. Core headline earnings which excludes losses on cash remittances was down 38% mainly due to the additional investment in Showmax and the lower net contribution from Irdeto in South Africa partially offset by improved results in the rest of Africa. Slide 34 provides an update on our free cash flow. The waterfall graph highlights the key cash flow movements during the year which we unpack starting from the left. In the comparative period, we generated ZAR2.9 billion in free cash flow. The lower EBITDA resulted in a ZAR2.5 billion lower cash amount this year. Payments of ZAR1.7 billion were made to Peacock for customization of the platform ahead of the relaunch in February. Content payments came in ZAR700 million lower owing to better pricing negotiated for general entertainment and sporting contracts and the business benefiting from pre-payments made in the prior year. We also benefited from a ZAR1.2 billion improvement in other working capital which includes the benefit of timing of supplier payments that resulted in free cash flow of ZAR600 million for financial year '24. Turning to Slide 35. Although, retained earnings reflects a positive balance of ZAR16.2 billion, we currently have a negative equity balance of ZAR1.1 billion as a result of IFRS-related non-cash accounting adjustments. These adjustments can be explained as follows. We are affected by the foreign exchange impact on the translation of the US dollar-based intergroup loan sitting between multi-choice Africa holdings and multi-choice Nigeria. This loan is split between a portion that is treated as an equity investment in the business and is referred to as quasi-equity and the loan portion referred to as the non-quasi loan. When we re-value the loan at year end, the adjustment flows up to the Group resulting in a negative impact on the profit and loss and consequently reserves. This is not new accounting treatment. However, considering the naira move from NGN465 to the U.S. dollar at March 2023 to NGN1,308 at March 2024 the adjustment has now become material. The second adjustment arises from a put option in our agreement with Comcast which permits them to put their 30% shielding to us at fair market value on the 7th anniversary of the Showmax launch date. IFRS requires us to initially measure the put option at fair value with the resultant entry being the recognition of the put option liability and a corresponding adjustment in equity up front. It does not factor in the probability of the put being exercised and is merely an accounting entry. The fair value came to ZAR2.7 billion at year-end creating the corresponding drag on reserves. As part of our cost program and interventions to preserve cash and given the changing circumstances of the Group, we reviewed all our major OpEx and CapEx spend. One of these was the tech modernization project which has been running for a number of years with the objective of upgrading our current systems to best-in-class global systems. Four modules have gone live with two modules still in development. We reassessed the project and the material cost to completion over the remaining four-year period. We also considered the uncertainty in relation to the outcome of the CANAL+ offer which may impact on systems should the offer be successful. We concluded that our current system architecture is sufficient for our current needs and we terminated the project. This has resulted in a once-off ZAR1.2 billion write-off. Combining these non-cash accounting adjustments affected the equity reserves by ZAR8.5 billion. Regardless of the negative equity position our balance sheet provides financial flexibility to fund the business. Let's take a closer look on Slide 36. Our reported cash holdings declined marginally from ZAR7.5 billion to ZAR7.3 billion in financial year '24. It includes the payment of the ZAR1.4 billion Phuthuma Nathi dividend in September as we upstream the cash from the South African business to the Group. We retain access to ZAR4.1 billion in undrawn Group borrowing facilities, which, combined with the cash, results in total available funding of ZAR11.4 billion. Existing short-term cash commitments and illiquid cash mainly in Nigeria amounts to ZAR4.5 billion. This leaves ZAR2.8 billion available in cash providing sufficient financial flexibility to fund our business. Following the drawdown of the remaining ZAR4 billion term loan, our debt position has risen from ZAR8.4 billion in FY '23 to ZAR12 billion in financial year '24. After including our satellite leases, our leverage ratio is 1.53 times, well within an acceptable range. This concludes the overview of our financial performance. So, let's turn to Slide 38 for our outlook for the year ahead. As we look into the coming months, there are a few things that we'll be focusing on. First, there is the mandatory offer from Canal+ for our shares at ZAR125 per share. This deal is subject to regulatory approvals with a long stop date of the 8th of April 2025. Details regarding this proposed transaction is available in the Combined Offer Circular which was released on the 4th of June and is available on our website. Given ongoing uncertainty around economic recovery across the globe and our footprint in particular, we'll be to drive further business efficiency and have set ourselves a target of reducing costs by another ZAR2 billion this year. This combined with ongoing retention initiatives should provide an underpin for us to keep the trading profit margin of the South African business in the mid-20%s and maintain profitability in the rest of Africa. As Calvo explained in his overview, we have several revenue streams to drive future growth. Our focus in the year ahead will be to accelerate the scale of Showmax, SuperSportBet in South Africa as well as DStv's Insurance and Internet businesses. In addition, Moment will be looking to launch its B2C payments platform to expand its capacity across the continent. So these are our plans for the year ahead. True to our vision, we'll continue to enrich lives through entertainment and technology. That concludes our presentation for today. We are happy to now take some questions.

Operator: At this time, we will be conducting a question-and-answer session. [Operator Instructions] The first question we have comes from Jared Hoover of RMB Morgan Stanley. Please go ahead.

Jared Hoover: Good afternoon, Calvo and Tim, and thanks for the call. A few questions from my side, please. And I thought I'll just start with South Africa. As you mentioned, your guidance for FY '25 is for flat trading profit margins, which basically implies that you expect your cost growth to be offset by top-line growth or by cost-out initiatives. So, I've got two questions on that, one on top-line, one on cost-out. So, on the top-line, you've been losing subscribers across all three of your categories, so it really looks like you're relying on cross-selling your ancillary products like DStv Stream, Insurance, Extra Stream, etc. So, the question is, is how big do you think that opportunity is, and on what timeline do you think you can get there, and where do you expect 2025 SA revenue to largely land? And then my second question on the cost side, it looks like about 40% of your costs are dollar-based, and those dollar-based costs have been hedged at a ZAR that's 20% higher than FY '24. So, it looks like you're going to have a material cost headwind in 2025 in South Africa. So, can you just help me understand what the opportunity is there to take out more cost than the ZAR2 billion that you're guiding for? Okay, I'll start there, and then I'll follow up with one or two more. Thanks.

Calvo Mawela: Yeah. Thank you very much for the question. In as far as revenue and top-line growth, what we have done is we have increased our prices in line or just above inflation in this financial year, that's the first thing. The second thing to mention is that, as we have mentioned, that we are looking at DStv Insurance and DStv Stream and DStv Internet, which are gaining good traction. Those are the new areas of growth that we think should be able to help us to grow our top-line as well, but I'll let Tim also explain it.

Tim Jacobs: Yeah, so guys, we see quite a significant opportunity to continue to accelerate the scale of our insurance business and our DStv Stream. Both of those, we relaunched or we put in a significant amount of effort over the last couple of years. DStv was relaunched in this past financial year. We've seen 139% increase in subscriber numbers from July through to financial year-end, and we think that that's something that, combined with our bundled Internet products, can really start accelerating. On the Insurance side, we've seen an accelerated growth in that business, and what's been really pleasing is that the growth has come from a lot of the new products that we've added to the mix. So we've seen pretty solid device insurance growth, and we've also seen exceptional growth in the life insurance product. So, now that we've got these products on for the full year, we really are looking to continue with that growth trajectory. I think the second part of the question was, what do we do around the cost side? So clearly, we've set ourselves an ambitious target at ZAR2 billion. That's more than double what last year's target was, and higher than the ZAR1.9 billion that we've achieved in '24. What we have in terms of this ambition is we actually have a multi-year cost reduction program. We've approached the difficulties that we see in the market on the basis that, if these difficulties continue for a period of time, how do we right-size this business and take into account the significantly weaker currencies, customers under pressure? And so, we're setting this target not necessarily just in the context of FY '25, but actually as a multi-year program where we basically try to resize our business over a three-year period. We are fairly confident that this is achievable. We've already identified savings not just in the FY '25 year, but also going into both of FY '26 and FY '27. It's not fully -- we haven't fully baked in all of the potential opportunities that we're looking for. We're still -- in the outer years, we're still probably about 50% off in the year-three in terms of identifying cost savings. But we've approached this very systematically and very disciplined. And we've not -- this is not a wish list. This is an itemized commitment that each of our CEOs and CFOs in each of our business units have identified. And we believe strongly that this is something that we can deliver on.

Jared Hoover: Okay. Great. And then my follow-up questions, the one on Showmax. I think you put up a slide where you had the free cash flow outflow related to Showmax. I think it was $4.1 billion. It looked like that includes some prepaid assets. So, into 2025, I think you did guide that trading profit losses are going to be higher than in 2024. But I just want to understand, firstly, where -- roughly where that would land on the trading profit side for Showmax. And two, how does that compare to the free cash flow outflow we should expect for Showmax into 2025? And then very lastly, on your balance sheet, I think it was Slide 34 or Slide 35, it looks like you've got about ZAR2.8 billion of, call it unencumbered or available cash, plus about ZAR4.1 billion in headroom on your facilities. So combined, call that ZAR7 billion. But my understanding from your CMD was that you need about ZAR5 billion on your balance sheet for intra-period working capital swings. So I guess the question really is, is what is your level of comfort around the liquidity at multi-choice to be able to handle any material downside surprises in 2025? I'll leave it there. Thanks.

Calvo Mawela: Okay. So, look, on the -- on our Showmax business, I think let's start there. Very clearly, I think we're in a position at the moment where, as you guys can see, we are busy with many moving parts in terms of how these numbers are playing out. And we very specifically did not give a specific guidance for where Showmax is going to end up this year. But what we can share is the volume, right? We need to start off with the position that Showmax is going to effectively have a time shift in costs. Again, that is because we launched Showmax a little bit later in the year than what we had initially anticipated. So, in financial year '24, we originally were thinking that the launch was going to happen a couple of months earlier. And because it ran late, there's a couple of time-shifted costs. One, we'll see the depreciation of the investment that we made in the Peacock platform. That depreciation charge will come through, number one, and it'll be for the full year. We'll be running the new platform in the new markets with additional content spend, and that will be for a full year as well. And we just have a net run rate. As we started to capacitate the teams, that run rate will also be running for the full year. On the other side of that, of course, we have quite strong ambitions as we build out additional capacity in the payment channels and in our partnership models to accelerate the growth in the top-line. So, at this point, we're not giving specific guidance other than we expect an annualized -- this annualization, and this -- because of the late launch, we expect to shift some of those peak losses that we had anticipated in FY '24 into FY '25. Okay, so the second question is relating to liquidity. I'm not actually in touch with where your reference point came from in terms of the working capital movement. No, no, no, I'm off there. So, Jared, sorry. You asked a question. You said we've got ZAR2.8 billion of cash after commitments, and we have ZAR4.1 billion in facilities. That is correct. And then what was your reference point about working capital needs?

Jared Hoover: I think it was at your CMD last year. I think it was specifically in the strategy section, if I'm not mistaken. And you had a slide, and you basically said that you'd like to maintain about ZAR5 billion of cash on your balance sheet for inter-period movements. And I mean, maybe that's changed from last year to this year. But I mean, if I take that into consideration, and that's my starting point, it would seem to me that, I mean, that you don't have much marginal safety on your balance sheet if there were to be a material downside event. So, maybe the ZAR blows out, maybe there's another depreciation in one of the African countries, or maybe the consumer becomes a lot more constrained across your footprint that would necessitate you holding more cash on your balance sheet.

Tim Jacobs: Yeah. So, look, I think in Capital Markets Day, that was a little while back, and I think will be -- there were a couple of things that were top of mind when we did the Capital Markets Day. We were busy with the FIFA World Cup, which obviously had a slightly higher working capital investment cycle. That investment cycle is now released, and you guys will know that that tends to be a significantly higher working capital investment year than any other year that we have. I think that where we're going to make sure that this cash facility is enough is around incredibly disciplined cost application. So, we've set ourselves a higher -- much higher target for this financial year. You will see that in the second half of financial year '24, we were significantly higher in terms of how the splits of run rate costs were being delivered. In other words, the cost saving in the second half of the year was significantly higher than the first half of the year, and we're looking to continue that run rate into the -- into financial year 2025. So, we have a number of programs, that discipline needs to continue, and it needs to continue throughout the course of this year.

Jared Hoover: Okay. Thanks, Tim.

Operator: Thank you, sir. [Operator Instructions] The next question we have comes from Jonathan Kennedy-Good of Prescient Securities. Please go ahead.

Jonathan Kennedy-Good: Good afternoon, and thanks for the opportunity to ask questions. My first question is on your tactical choice to reduce the decoder subsidies. How much of that decision impacted the decline in subscriber numbers for the year? And how should we think about decoder subsidies going into FY '25? Would you reinstate some of those subsidies if you continue to see subscriber loss? And then, secondly, on content costs, which look to be I think fairly flat, given the loss in subscriber numbers, is there any kind of variability that you can benefit from, i.e., a variable portion of content costs, or is that largely fixed and not on a subscriber cost per unit basis?

Calvo Mawela: Thanks for the question. I will try to answer the question on subscriber decline holistically. First is that nobody likes a negative trend, especially on subscribers, but we should bear in mind that we sell discretionary product, which is linked to economic cycle and which is also dependent on people's discretionary income. Those are the two points that I would like to mention first. The other two points worth noting is that we are very slowed down in growth every year subsequent to a FIFA World Cup, and this year was no different. The customer losses this year were scored towards the mass market, where activity levels and output contribution is much lower. But looking specifically at the factors that contributed to the negative growth of this year, the first one was our decision to reduce decoder subsidies, which impacted new additions to our subscriber numbers. The second one is that in order for us to offset the impact of high inflation in our markets, we've had to increase prices on average in the rest of Africa by 27%. We estimate that these two factors combined accounted for about 20% to 40% of the decline. But the most significant factor impacting growth was the macroeconomic cycle that we've already explained in our presentation, also made worse by the impact of disrupted power supply in South Africa, Nigeria, and the likes of Zambia. I'll hand over to Tim to speak to the content costs.

Tim Jacobs: Okay. So thank you for the question. Most of the larger content renewals for sport have been completed recently, so it'll take a while before the next round of negotiations comes up. The opportunity to reduce cost of international content through the world is an opportunity to reduce the cost of international general entertainment content, maybe through renegotiations. And the areas that we see this potentially playing out is through more efficient scheduling, so in other words, using 10-fold content more effectively, and that means that we don't have to do additional content spend. Then more effective sharing of content and measures to drive optimization. We typically do this through our content hub in general entertainment, and here we see a big opportunity to really make a lot of efficiencies in the content that we use on both the linear platforms and the Showmax platform. So, differences between windowing strategies and making sure that we're not just doubling up on the spend on both sides. So we've been spending quite a bit of time really going and looking at the curation of content on each of those platforms and making sure that we get the most from the spend that we are making in the business. And then lastly, we see a significant benefit of supply through the Comcast deal, so those are NBC Universal, DreamWorks, Universal Studios, Sky, and Peacock, and we're planning to make sure that we maximize that across -- again, across all of the platforms. The one unknown that we do have, of course, is what happens with the foreign exchange rates. But as Jared noted, we've been using periods of weakness in the -- or strength in the rand, should I say, over the last six months to continue topping up on our forward cover. We've managed to actually complete hedges for all the way out to April next year. So at least for the financial year 2025 at one stage, we had quite a bit of exposure with uncovered positions, but those have now largely been -- well, they've been fully covered out to -- for the next financial year. And we've done that at roughly about NGN1,880 for the next 12 months, as we sit here today. So, slightly higher than the NGN1,875, I think that's included in one of our annexures in the deck. We've added a couple of more months at NGN1,880. So at least we have certainty around where our dollar costs and cash flows are going to end up. And now the opportunity, of course, is to start reducing spend around that. And in particular, the other area that we think we see as a strong area of saving is, of course, in some of the CapEx programs, you will have seen that we took a big impairment charge this year on the TechMod program. But equally important is what that represents. So, that program in our forecasts had some significant spend over quite a long period of time. And because we were able to -- because we've decided to close down the last two modules that were still in development phase and had a significant timeline to completion, that means that those cash flows will no longer be incurred. And that will give us some relief on the CapEx program.

Jonathan Kennedy-Good: Great. Thank you very much for your answers.

Operator: Thank you, sir. [Operator Instructions] The next question we have comes from Jono Bradley of ABSA. Please go ahead.

Jono Bradley: Good afternoon, and thanks very much for the opportunity to ask questions. I have just three, starting with Showmax. Firstly, just to clarify on the cost run rate. We did ZAR3.7 billion this past year. Is it fair to say we should expect this to ramp up quite significantly on FY '25? And if you could give any clues over the sort of profile over the next one to two years, that would be very helpful. And then still on Showmax, but looking at your revenue targets, I think at the Capital Markets Day, you talked around a billion dollars, achieving that in sort of the next four to five years. I mean, just your thoughts on those targets. Is it still achievable in that same timeframe? And then lastly, on your pricing strategies across both South Africa and the rest of Africa, I mean, we've seen quite a steep step up in price increases. At the same time this year, we've obviously seen the subscriber base weakening quite a bit. Are you planning to maintain the current pace of price adjustments, or could that ease given the subscriber pressure? Thanks very much.

Tim Jacobs: Okay. So, let me start with the cost run rate. So, I think firstly, I don't know that we necessarily are going to accelerate from the levels that we saw in FY '24. I think our first target is to at least look at matching the cost run rate savings into 2025. But we have got -- as I said to you, we have got a multi-year program at these more elevated cost saving levels. So we're making -- and of course, if we can put any of those savings forward into the 2025 year, we'll certainly be doing that. And these savings are kind of across the board. You'll remember that we also spoke a little bit in the past about some of the satellites that start coming up for renewal. The rest of Africa satellites come up during the course of 2025. So, we're looking to start renegotiating and bringing the capacity that we need to use on those satellites down. And we see some significant savings that starts to be generated out of that. So again, we're expanding the target of where we're looking for these savings. We're getting into some of the big ticket items like satellites. And so these give us some opportunities, I think, to make sure that we can keep this run rate of savings at least for another couple of years. Your second question was around Showmax and whether we're still on track for a billion dollar turnover. I think key to that was going to be the launch of the Peacock platform. We've done that, as Calvo mentioned. What was really successful there was that we overshot on being able to migrate all of the customers that were eligible on the old base across to the new base. And 88% of those customers have already reactivated by March. So, we're now using the off-season to start working on developing out additional payment channels that will be critical to starting to see that acceleration in subscriber numbers once we see the start of the Premier League. So that's something that we're looking very forward to. And at the moment, we're not seeing any change in that ambition and the timeline for that billion turnover. The last question relates to pricing strategy?

Jono Bradley: Yeah.

Calvo Mawela: Yeah. We are still very clear that we're following inflation in the markets that we operate in. We think it's a discipline that we need to continue with. And we have had engagements with our teams in the country, and they feel very comfortable that the pricing line with inflation is the best way -- is the best outcome for us from a financial perspective. So, we'll continue with that. And we understand these economic cycles that we'll go through. But as things improve, our product is to believe very strongly that it offers great value for our customers. We have got the best in local, the best in sports, and the best in international. And families need this for entertainment going forward.

Tim Jacobs: I think what is also important, right, is when we look at the -- when we look at our base, and we have a look at why are people churning off our base, one of the things we look at quite strictly and quite deeply is the performance of the content on the platform. So, we have a look at our channels, the stuff that we put out there. All of the channels over the last six months have improved in ranking. And we're still seeing a significant increase in the number of minutes that get watched. So, for the number of local content hours that we produce, it's at about 33% of total broadcast hours. That's being watched about 46% of the time. And so that tells us that the movements that we see in the subscriber base are not linked to the content offering. The value proposition is still there. But obviously, the one thing that we've always been disciplined around with the pricing is you can't price according to the exchange rate movements. So when you've got years like the one that's just happened, where you get a significant currency movement, you've got to be quite disciplined in your pricing close to inflation, because ultimately that's over time is how you claw back the big impact -- the big financial impact of these exchange losses on translation. So, I think to Calvo's point, the teams are fairly disciplined at the moment. And what we are doing is trying where we can to split up the inflation, big inflationary price increases into more than one increase to limit the immediate shock of a big bull increase on a customer. So, we're trying to balance that and find the best way through what is very clearly a very difficult situation for customers on the ground.

Jono Bradley: Thanks very much, Tim. Just on the first question, just to clarify, sorry, the question is specifically on the costs within Showmax. I think you did about a billion around revenue and losses of I think it was ZAR2.6 billion implies a cost of about ZAR3.7 billion in the year. So just your thoughts around how that cost moves. I mean, does that ramp up significantly into FY '25 and then into FY '26? Does it stabilize from there? If you can give any sort of guide on that.

Tim Jacobs: What we're expecting to see is effectively an annualization of the costs into '25. And so, kind of a peaking of the cost and then it stabilizing from there. And the growth in the revenue number will effectively bring us back to break even with the end of '27 as the target -- as a target date for that.

Jono Bradley: Awesome. Thanks very much.

Tim Jacobs: Okay.

Operator: Thank you, sir. Ladies and gentlemen, we have one final question from Jared Hoover. Please go ahead.

Jared Hoover: Hi, guys. Just a follow up for me on your cost out targets. I think you mentioned ZAR2 billion, the number for 2025. And you've just spoken about a renegotiation of some of the rest of Africa transponders. So, first question on that, is any of the renegotiation of your rest of Africa satellites baked into the ZAR2 billion cost saving? And second question on that, if not, are you able to give us a sense of the amount of capacity that you're looking to take off those transponders? And would that be linear? For example, if you're taking off 30%, can we assume that there'd be a 30% saving on your rest of Africa transponder costs? Thanks.

Tim Jacobs: I think firstly, our targets for cost saving include all of these items that we mentioned. So it includes the transponder savings. We obviously don't want to give too many details because these are still subject to negotiation, right? And our satellite providers are obviously quite sensitive about the fact that we're looking to reduce this capacity. So we don't want to go into too much detail until we're able to close out those discussions with the satellite providers. So if you guys will just bear with us, we'll obviously come back to the market and give you details once we're able to do that. But the volume or the transponder capacity reduction is fairly material. The compression technology that gets applied is quite meaningful. I think we expect them to be able to take a number -- like quite a large number of transponders out of service if we get our negotiations right.

Jared Hoover: Okay. Thanks, Tim.

Operator: Thank you. Ladies and gentlemen, there are no further questions on the conference call. I will now hand back to management for questions on the webcast platform.

Meloy Horn: Thank you, Danae. We have two questions here on the online platform. The first one is from Jared from All Weather, asking some information about the Bidstack investment rationale, and whether this was an investment made by Irdeto. Yes, Jared, that's correct. It was an investment by Irdeto. And I think, given that this was very small transaction, maybe best to get back to me and I can provide you with further details. Then we have another question from Carl, who is saying -- want to -- please can we comment on the implication of the Canal+ plans? How much management time needs to go to the process of cooperating with them on the regulatory issues or is the work of the board separate to that of management? So, on that one, maybe just to explain, I mean, the independent board has already expressed an opinion about the offer. So, the board is not involved with the process any further. In terms of the cooperation agreement, there are ongoing discussions at this stage to address things like the structure, etc., from a regulatory perspective. So, we have our regulatory and legal teams specifically focusing on this work stream. And as soon as we have more information to share with the market, we will get back to you through the appropriate channels. So, that's the two questions that I have on my side. I think that brings an end to today's session. And I would like to hand over to Calvo to conclude.

Calvo Mawela: Thanks, Meloy. Ladies and gentlemen, we hope you found our feedback useful. And we'd like to invite you to reach out to our IR team if you have any further questions or need more information. Thank you for joining us today and goodbye.

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