Multichoice CEO Calvo Mawela at the company's Listing on the JSE. Picture: FREDDY MAVUNDA
Multichoice CEO Calvo Mawela at the company's Listing on the JSE. Picture: FREDDY MAVUNDA

MultiChoice Group’s shares have risen to their best level yet since the pay-TV operator was separated from Naspers in February, with the stock rallying due to its maiden earnings report on Tuesday.

MultiChoice said its subscriber base grew 12% to 15.1-million customers in the year to end-March. Revenue rose 6% to R50.1bn and core headline earnings grew 10% to R1.8bn.

But partly because of an empowerment transaction and foreign-exchange losses, the group made a loss of R1.3bn, from a profit of R2.5bn the previous year.

MultiChoice said it would not pay a dividend for the year but said it was "on track" to declare a dividend of R2.5bn, or 569c a share, for the financial year to March 2020.

After gaining 2.2% on Tuesday, MultiChoice’s shares added another 5.9% on Wednesday morning to reach R138.49, their best level yet.

Vestact CEO Paul Theron said in a note to the asset manager’s clients that MultiChoice’s results showed the business was growing.

Aside from subscriber growth, particularly in the rest of Africa, "sign-ups for digital delivery services such as Showmax and DStv Now are growing fast", Theron said. 

"Local content production is up, and the sports offering is still amazing."

The group had a "very strong financial position".

"The stock has done well since making its market debut, rising from a low of about R93 per share shortly after coming onto the market. Hold onto this one, or even buy some more," Theron said.

MultiChoice’s shares were at R135.98 at 11.05am on Wednesday, giving the group a market capitalisation of R59.6bn.

hedleyn@businesslive.co.za