This data was part of the Group's Interim Financial Results for the period ending 30 September 2024, released on Tuesday.
The company linked this subscriber decline to Nigeria's high inflation rate, which has surpassed 30%, driven primarily by escalating costs of food, electricity, and fuel, leading many customers to discontinue their services.
While exact numbers were not disclosed at that time, Multichoice had earlier indicated an 18% drop in its Nigerian subscriber count in its financial results for the year ending March 2024.
Furthermore, the company highlighted that its subscriber base in the Rest of Africa Operations continued to encounter difficulties from the previous year, resulting in a total loss of 566,000 subscribers during the reviewed six-month period.
Although the recent subscriber loss shows improvement compared to the 803,000 lost in the same period last year, Multichoice noted that the majority of this decline was concentrated in two markets: Zambia and Nigeria.
“With the Rest of Africa business having seen a decline of 803k subscribers in 2H FY24, this rate of decline slowed to 566k in 1H FY25.
“Of this decline, 298k related to Zambia and 243k related to Nigeria, with remaining markets on the continent reflecting only a minor decline of 25k,” the company stated in its financial results.
Inflation has been cited as the primary reason for the financial losses in Nigeria, whereas the company has linked the losses in Zambia to power outages caused by drought, which can last up to 23 hours daily.
In discussing the company's performance, MultiChoice Group CEO Calvo Mawela remarked that the organization is currently experiencing its most difficult operating environment in nearly four decades.
To achieve profitability, he noted that the Group has taken proactive measures to "right-size" the business in response to the prevailing economic conditions and shifts within the industry. He also pointed out that while operating throughout Africa generally exposes the group to currency fluctuations, the extraordinary currency depreciation over the last 18 months has led to a profit decline of nearly R7 billion.
“Combined with the impact of a weak macro environment on consumers’ disposable income and therefore on subscriber growth, it required the Group to fundamentally adjust its cost base – which is exactly what has been done.
“We are making good progress in addressing the technical insolvency that resulted from non-cash accounting entries at the end of the last financial year.
“We expect to return to a positive net equity position by the end of November this year, supported by a number of developments and initiatives. The Group’s liquidity position remains strong, with over ZAR10bn in total available funds,” he said.
Mawela stated that the Group is responding to the challenges presented by the global pay-TV environment, where the rise of streaming services, the expansion of social media, and changing consumer preferences are impacting traditional broadcasting.
He highlighted that Showmax has experienced a 50% year-on-year growth in its paying subscriber base, positioning it well to participate in the streaming revolution as it gains momentum across Africa. To support capacity enhancement and promote growth, the Group has invested an additional ZAR1.6 billion in this sector during the interim period.
In light of increasing inflation, Multichoice Nigeria implemented price hikes for its DStv and GOtv packages twice last year and once this year, resulting in three increases within a single year. The first adjustment took place in April 2023, followed by another in November, with the most recent change announced in April this year, set to take effect on May 1.
Before the new pricing took effect on May 1, a Competition and Consumer Protection Tribunal (CCPT) in Abuja issued an order to halt the price changes after a complaint from a Nigerian customer.
Despite this, Multichoice moved forward with the price adjustments, prompting the Tribunal to impose a fine of N150 million on the company for challenging the court's authority. The ruling, delivered by a panel led by Thomas Okosu in June, also required Multichoice to offer Nigerians a one-month free subscription for both DStv and GOtv.