Prosus, subsidiary of Naspers, announces increase in profits from Tencent stake

AMSTERDAM, June 21 (Reuters) – Prosus NV (PRX.AS), the international investment arm of South African firm Naspers (NPNJn.J), on Monday reported better-than-expected net profit of 7.45 billion dollars for 2021, driven by strong returns from its large stake in Chinese software giant Tencent.

However, the company reported an operating loss of $ 1.04 billion in companies it owns around the world in online marketplaces, food delivery and educational software.

Analysts had seen a net profit of $ 4.63 billion for the 12 months ended March 31, down from $ 3.66 billion for the same period a year earlier, according to data from Refinitiv. Prosus owns 28.9% of Tencent (0700.HK) and is itself controlled by Naspers, Africa’s largest company by market capitalization.

Of the net profit, $ 7.1 billion came from minority investments, dominated by the contribution from Tencent, which increased its profits by 33%.

Prosus said its operating loss was due to higher personnel costs and that its business had performed well amid the coronavirus pandemic.

He pointed to a 54% increase in turnover for the companies it consolidates, to $ 5.1 billion from $ 3.3 billion.

“During the period, we accelerated revenue growth, improved profitability and cash generation, and increased the number of customers,” the company said in a statement.

Prosus parent company Naspers reported a 24% increase in gross earnings per share – the main indicator of corporate earnings in South Africa – of 814 cents US, compared to 656 cents reported for the same period one year earlier.

Naspers currently owns 73% of Prosus. The companies are seeking shareholder support to move to a cross-ownership structure that would move most of their assets to Amsterdam while leaving control to Naspers. Read more

Reporting by Toby Sterling, editing by Louise Heavens

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