Financial Results Presentation For the year ended March 2009 Important information This presentation contains forward-looking statements as defined in the United States Private Securities Litigation Reform Act of 1995. Words such as “believe”, “anticipate”, “intend”, “seek”, “will”, “plan”, “could”, “may”, “endeavour” and similar expressions are intended to identify such forward-looking statements, but are not the exclusive means of identifying such statements. While these forward-looking statements represent our judgments and future expectations, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. These include key factors that could adversely affect our businesses and financial performance. We are not under any obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements whether as a result of new information, future events or otherwise. Investors are cautioned not to place undue reliance on any forward-looking statements contained herein. 2 FY09 Group Highlights Key Messages FY09 Results Performance by business Outlook Appendix 3 FY09 Group highlights Financial •Revenue increased 30% and EBITA up 21% •Core headline earnings up 9% to R4.4bn •Dividend up 15% to R2.07 per share Operational •Allegro performing ahead of expectations; revenue growth 47% •683,000 new gross pay-TV subscribers – 26% growth YoY •Print and technology impacted by cyclical downturn Strategic •Continued expansion into internet – US$200m in acquisitions during FY09 •Selective disposals – NetMed for US$560m, MWEB Africa (Apr 09) for US$55m •Print right-sized •Technology assets consolidated and synergies sought 4 Financial Highlights Revenue (ZARbn) Revenue (Rbn) EBITDA (ZARbn) EBITDA Margin (%) Up 30% 26.7 Up 23% 6.0 20.5 4.9 Down 1% 24 23 March 08 March 09 Core Headline Earnings (ZARbn) Core HEPS (ZAR) Up 9% Up 4% 4.4 4.0 11.30 11.79 1.80 DPS (ZAR) Up 15% 2.07 5 FY09 Highlights Key Messages FY09 Results Performance by business Outlook Appendix 6 Key messages 1 2 2 3 Diversified revenue streams Emerging market focus Long-term growth 7 1 Diversified revenue streams makes the group more defensive FY09 Revenue by business* FY09 Revenue by type* Pay TV (44%) Internet (21%) Technology (4%) Print Media (31%) Subscription (41%) IM & games (8%) e-Commerce (7%) Advertising (16%) Printing & distribution (12%) Technology (4%) Technology (4%) Book publishing (4%) Other (8%) *Based on economic interest, i.e. assuming all investments are proportionately consolidated 8 2 Emerging market focus – better growth prospects 9 3 Long-term growth enhanced by internet investments 7,256 Mar 07 Mar 08 Mar 09 Internet revenue (ZARm)* 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 3,037 2,078 * Based on economic interest, i.e. assuming all investments are proportionately consolidated 10 FY09 Highlights Key Messages FY09 Results Performance by business Outlook Appendix 11 Summary income statement Revenue EBITDA Operating profit Finance costs Finance costs Taxation Profit after taxation Core headline earnings Core headline EPS (ZAR) Mar 08 ZARm 20,518 4,900 3,878 1,005 1,005 -1,378 3,896 3,996 11.30 Mar 09 ZARm 26,690 6,026 3,783 1111 2222 -303 -303 3333 -1,436 4444 3,339 4,373 11.79 1111 EBITDA growth accelerated - +23% YoY (FY08 +15%) 2222 Affected by amortisation charges of R1.25bn (FY08 R375m) relating mainly to the acquisition of Allegro and Ricardo 3333 Net interest costs of R306m arising Net interest costs of R306m arising from the funding of new acquisitions. Also include pref divs of R377m and mark-to-market losses of R374m 4444 Effective tax rate now 29% (FY08 25%) due to full utilisation of tax shelters A R2.97bn profit from discontinued operations relate to the sale of NetMed 12 30% revenue growth, stronger than expected Revenue Growth (%) 60% 50% 40% 30% 20% 10% 0% 136% 42% 22% 29% 40% 25% ZARm Revenue Mar 08 20,518 Mar 09 % Change 26,690 30% Mar 08 Mar 09 • Organic growth 19%, rest acquisitive • Organic growth 19%, rest acquisitive • Internet resilient; revenue more than doubled • Pay-TV growth 29%; added 683,000 gross subscribers • Advertising revenue weak; internet adspend growing strongly 3% 8% Pay-TV Internet Technology Print *Internet growth not according to scale 13 Group operating margin contracted marginally Pay-TV: Programming costs (ZARm) 5,018 3,694 2,807 3,169 2,425 6,000 5,000 4,000 3,000 2,000 1,000 0 Mar 05 Mar 06 Mar 07 Mar 08 Mar 09 Pay-TV: Programming costs 44% 42% 40% 38% ZARm Mar 08 Mar 09 % Change Operating profit* 4,238 5,116 21% Operating margin 20.7% 19.2% * Before amortisation, other gains/losses • Pay-TV margin declined from 34% to 32% due to build- out of subscriber base • decoder subsidies • investment in premium content – Additional costs for customer service centres – Additional costs for customer service centres – Increased sports rights; committed for future • Internet affected by costs of expansion, but margins still improved • Print hit by once-off expenses and economy Sep 07 Mar 08 Sep 08 Mar 09 Programming as % of subs revenue 14 Development costs essential for long-term growth Internet Pay-TV Pay-TV Technology Print Total Mar 08 ZARm Mar 09 ZARm % Change 291 205 205 307 326 483 196 196 343 189 1111 2222 2222 66% -4% -4% 12% 1111 R131m for Allegro/Ricardo R98m for ibibo R77m for 24.com R50m for instant messaging 2222 R157m for mobile TV -42% 3333 3333 3333 Media24 R122m, mainly newspapers 1 ,129 1,211 7% 15 Equity accounted income growing strongly Tencent Abril Abril Mail.ru Other Equity accounted earnings Mar 08 ZARm 560 104 104 25 -35 654 Mar 09 ZARm 1,197 249 249 62 -35 % Change 114% 139% 139% 148% - 1111 2222 2222 3333 1111 Tencent experienced robust online game sales and strong growth in active IM user accounts 2222 Abril benefited from Brazilian economy and deleveraged balance sheet 3333 1,473 125% Mail.ru enjoyed 48% growth YoY in e-mail user base 16 Free cash flow up 18% Operating cash flow 5,104 5,814 Mar 08 ZARm Mar 09 ZARm Capex Capex Finance leases Tax -1,221 -1,221 -1,227 -1,227 -340 -450 1111 1111 2222 -1,553 -1,798 Investment income 71 98 Free cash flow (continuing operations) 2,061 2,437 1111 Pay-TV R486m Internet R220m Technology R107m Technology R107m Print R414m 2222 Increased costs of additional transponders leased 17 Net consolidated debt – group virtually ungeared Net cash – South Africa Mar 09 ZARm 1,910 Net debt – offshore (US$298m) -2,837 1111 Closing net debt Group gearing -927 3% 2222 1111 2222 Consists mainly of Allegro/ Ricardo funding (US$600m) less surplus cash held offshore cash held offshore Excluding transponder leases of R1.2bn, seen as operating cost for the group 18 Foreign exchange risk reduced through hedging US$ Forward Exchange Cover US$m US$ rate • Hedging strategy FY10 FY11 178 182 8.09 10.20 EUR Forward Exchange Cover – Pay-TV: long-term commitments, cover 100% of rolling 12 month net inputs – Print: short-term commitments; cover 12 months rolling input costs cover 12 months rolling input costs • Annualised net foreign input costs EURm EUR rate – Pay-TV: US$180m (programming rights and leases) FY10 FY11 61 5 12.53 14.38 – Print: EUR66m (capex, paper and ink) • Interest on Allegro/Ricardo debt facility hedged separately 19 FY09 Highlights Key Messages FY09 Results Performance by business Outlook Appendix 20 Naspers Internet Strategy – community based focus Social Network Social Network Social Network Social Network Tencent, Mail.ru, ACL Wireless, Gadu-Gadu, Buzzcity, ibibo, Compera Commerce Commerce Commerce Commerce Allegro, Ricardo, Tencent, MXit, Kalahari.net, ibibo Community Communication Communication Communication Communication Tencent, Mail.ru, Gadu-Gadu, MXit, Nimbuzz, Compera, ACL Wireless Games Games Games Games Tencent, Mail.ru, Gadu-Gadu, ibibo Content Content Content Content Tencent, Mail.ru, 24.com, Sanook! Fixed Mobile 21 Internet: Allegro & Ricardo Performing ahead of expectations EUR’m Revenue EBITA EBITA margin – total Mar 08 Mar 09 % Change 106.6 156.3 47% 18% 32.9 31% 38.7 25% 32% – core business 32% * Data reflects 100% of results; FY09 ZAR/EUR 12.26 (10.26); FY09 ZAR/Zloty 3.29 (2.74) • Contributed ZAR474m to group EBITA • CEE countries growing strongly • Western European countries flat • Margins affected by start-ups • Tracking ahead of initial investment plan • US$19.3m offer for Bankier.pl to expand financial service offering Revenue mix Mar 09 Financial performance (EURm) Revenue EBITA 156 Success fee (38%) Listing fees (29%) Promotional fees (23%) Payments revenue (5%) Advertising revenue (1%) Other (4%) 180 160 140 120 100 80 60 40 20 0 107 44 14 67 23 33 39 Mar 06 Mar 07 Mar 08 Mar 09 22 Allegro Auctions: Apr 2008 – Mar 2009 59BN page views 118m transactions €1.4bn GMV* €112m revenue Auctions: Apr 2007 – Mar 2008 47BN page views 79m transactions €950m GMV* €62m revenue *GMV = gross merchandise value; **information for Allegro auction platform only *GMV = gross merchandise value; **information for Allegro auction platform only Monetisation rate (%) March 2009 – YoY growth Success fees Other Listing and promotion Allegro Poland Aukro Czech Molotok Russia Teszvesz Hungary Aukro Bulgaria* Aukro Ukraine* Page views +34% +77% +124 +61% +338% +269% # of Transactions +42% +110% +98% +66% +351% +391% GMV (EUR) +34% +90% +89% +104% +556% +370% Total rate: 7% *Off a low base due to start-up nature of operations 23 Internet: Tencent (China) Powering ahead RMB’m* Revenue EBITA EBITA margin Mar 08 Mar 09 % Change 3,821 1,635 43% 7,155 3,246 45% 87% 99% * Data reflects 100% of results Jan-Dec; FY09 ZAR/Rmnb1.28 (0.97) Revenue mix FY09 IVAS gaming (42%) IVAS other (26%) MVAS (20%) Advertising (12%) • Contribution to FY09 core headline earnings ZAR1.2bn (FY08 R615m) • Revenue growth strong • Micropayments proving resilient • Key operational statistics at 31 March 09 – 935m total registered IM accounts – 410m active IM accounts (+29% YoY) – 410m active IM accounts (+29% YoY) – 58m peak concurrent IM accounts – 5.8m peak concurrent accounts for mini casual game portal – 183m active user accounts for Qzone – 36.8m IVAS subscriptions – 16.7m MVAS subscriptions 24 Internet: mail.ru (Russia) Growing strongly, despite economy RUR’m* Revenue EBITA EBITA margin Mar 08 1,316 865 66% Mar 09 % Change 1,869 1,004 54% 42% 16% * Data reflects 100% of results from Jan-Dec; FY09 RUR/US$ 25.1 (25.6); ZAR/US$ 8.79 (7.16) Revenue mix FY09 Display advertising (56%) Context Advertising (20%) Listing Fee (5%) Fee-based (8%) Partnership (11%) • Acquired additional 10% in Dec 08 • Contribution to FY09 core headline earnings ZAR87m (FY08 R49m) • Margins affected by hard currency costs • Revenue diversification continuing • Mail.ru now owns 49% of Molotok • Key operational statistics at 31 March 09 – #1 site in Russia in reach and rank – 77m total users (+48% YoY) – 10.3m casual games users 25 Pay-TV: South Africa Proving its resilience Gross subscribers Revenue EBITA EBITA margin Mar 08 1,948 ZARm 8,567 3,392 40% Mar 09 % Change 2 ,401 ZARm 10,335 3,798 37% 23% 21% 12% Gross Subscribers (‘000) Digital mix 2,600 2,400 2,200 2,000 1,800 1,600 1,400 1,200 1,000 Other Compact PVR Premium (excl PVR) 15% 15% 16% 54% 19% 21% 15% 45% 2,401 1,948 1,651 1,466 2006 2007 2008 2009 Mar 08 Mar 09 • FY09 gross subscriber growth 23% • 453,000 gross additions YoY – Premium +8% – PVR +16% – Compact +82% • Advertising under pressure • Churn trending up • Uptrading = downtrading to date • Uptrading = downtrading to date • Subscription fees hiked 1 Apr 09 – Premium +6% (R499) – Compact +10% (R219) – Analogue +6% (R268) • Competition anticipated in 4Q09 • Expect more regulations • Mobile TV – awaiting license • Digital terrestrial (DTT) migration – awaiting regulations 26 Pay-TV: Sub-Saharan Africa Record growth despite competition Mar 08 Mar 09 % Change Gross subscribers Revenue EBITA EBITA margin 686 ZARm 3,056 1,008 33% Gross Subscribers (‘000) Digital mix 10% 24% 6% 60% 916 686 543 419 1,000 900 800 700 600 500 400 300 200 916 ZARm 4,550 1,562 34% 8% 35% 7% 51% 2006 2007 2008 2009 Mar 08 Mar 09 33% 49% 55% Other Family & Compact PVR Premium (excl PVR) • FY09 gross subscriber growth 33% • 230,000 gross additions YoY – Premium +16% – PVR +58% – Compact +84% – Family +86% • Subscription fees hiked 1 Apr 09 – Increase between $1 - $5 – Increase between $1 - $5 • Seasonality of soccer benefits 2H growth • Competition intensifying further • Churn trending up • Regulation increasing in complexity across continent • Mobile TV in Nigeria, Kenya, Ghana and Namibia 27 Technology Operations being repositioned ZARm Revenue EBITA EBITA Mar 08 Mar 09 % Change 1,081 1,514 -168 -168 -132 -132 40% 21% 21% • Business affected by current economic downturn • Irdeto shipped 15m units in FY09 (10.7m) • Integrated all technology businesses 28 Print – South Africa Advertising hit by economic downturn Print Revenue EBITA EBITA margin Books Revenue EBITA EBITA margin EBITA margin Mar 08 5,414 670 12% Mar 09 % Change 5,614 618 11% 4% -8% Mar 08 Mar 09 % Change 877 58 7% 7% 894 59 7% 7% 2% 0% Revenue mix FY09 Advertising (36%) Circulation (19%) Printing (19%) Other (14%) Books (12%) • Consumer spending under pressure • Advertising revenue growth slowed to 2% • Reduced headcount by 10% • Margins affected by ~R80m one-off restructuring costs • Good circulation growth across most emerging market titles • Books performance stable • Continued investments in new titles, market • Continued investments in new titles, market development and product extensions • Significant investment in process optimization 29 Print – Abril Attractive economy Brazil (Abril) Brazil (Abril) Brazil (Abril) Brazil (Abril) • Naspers own 30% • Contribution to core headline earnings increased to R414m (FY08 R150m) • Deleveraging benefitting bottom line – interest expenses down 83% down 83% • Circulation and printing growing • Advertising under pressure • Margins affected by acquisition of distribution business • Implementing cost-cutting strategies BRL'm Revenue EBITA EBITA margin Mar 08 Mar 09 % Change 2,396 3,015 386 16% 371 12% 26% -4% *Data reflects 100% of results Jan – Dec; FY09 ZAR/BRL 4.47 (3.91) 30 FY09 Highlights Key Messages FY09 Results Performance by business Outlook Appendix 31 Outlook Diversified revenue streams •Resilient businesses in growing markets •Some risks due to pay-TV competition, regulation and slower consumer spending Emerging market focus •Still providing better growth prospects relative to developed markets •Expansion anticipated in Asia, Central & Eastern Europe and Latam Long-term growth •Contribution from internet investments to keep growing •Anticipate more bolt-on purchases complementing existing internet operations 32 FY09 Highlights Key Messages FY09 Results Performance by business Outlook Appendix 33 Pay-TV subscribers Gross subscribers Gross subscribers Gross subscribers Gross subscribers Mar 08 Mar 08 Mar 08Mar 08 Mar 09 Mar 09 Mar 09Mar 09 Equated subscribers Equated subscribers Equated subscribers Equated subscribers Mar 08 Mar 08 Mar 08Mar 08 Mar 09 Mar 09 Mar 09Mar 09 Africa Africa Africa Africa SA - analogue SA - digital Total S.A. Total S.A. Total S.A. Total S.A. Sub-Saharan Africa - digital Saharan Africa Total Sub----Saharan Africa Total Sub Saharan Africa Saharan Africa Total Sub Total Sub Total Africa Total Africa Total Africa Total Africa Total Africa Total Africa Total Africa Total Africa Africa - analogue Africa - digital Total Africa Total Africa Total Africa Total Africa PVR subscribers PVR subscribers PVR subscribers PVR subscribers PVR - South Africa PVR - Africa Total Total Total Total 171,583 1,776,430 1,948,013 685,916 685,916 Africa Africa Africa Africa 139,944 SA - analogue 2,261,547 SA - digital 2,401,491 Total S.A. Total S.A. Total S.A. Total S.A. 915,655 915,655 Sub-Saharan Africa - digital Saharan Africa Total Sub----Saharan Africa Total Sub Saharan Africa Saharan Africa Total Sub Total Sub 2,633,929 2,633,929 2,633,929 2,633,929 2,633,929 2,633,929 2,633,929 2,633,929 3,317,146 3,317,146 3,317,146 3,317,146 3,317,146 3,317,146 3,317,146 3,317,146 Total Africa Total Africa Total Africa Total Africa 171,583 2,462,346 2,633,929 2,633,929 2,633,929 2,633,929 Mar 08 Mar 08 Mar 08Mar 08 241,696 38,567 280,263 280,263 280,263 280,263 139,944 Africa - analogue 3,177,202 Africa - digital 3,317,146 3,317,146 3,317,146 3,317,146 Total Africa Total Africa Total Africa Total Africa Mar 09 Mar 09 Mar 09Mar 09 329,957 60,774 390,731 390,731 390,731 390,731 156,488 128,376 1,413,054 1,610,434 1,569,542 1,569,542 1,569,542 1,569,542 1,738,810 1,738,810 1,738,810 1,738,810 538,706 538,706 538,706 538,706 538,706 672,028 672,028 672,028 672,028 672,028 2,108,248 2,108,248 2,108,248 2,108,248 2,410,838 2,410,838 2,410,838 2,410,838 156,488 128,376 1,951,760 2,282,462 2,108,248 2,108,248 2,108,248 2,108,248 2,410,838 2,410,838 2,410,838 2,410,838 34 Consolidated income statement Revenue Revenue Revenue Revenue Operating profit Operating profit Operating profit Operating profit Finance Costs Share of equity accounted results Profit on sale of investments Impairment of equity accounted investments Profit before taxation Profit before taxation Profit before taxation Profit before taxation Taxation Profit after tax Profit after tax Profit after tax Profit after tax Profit from discontinued operation Profit on discontinuance of operations Net profit Net profit Net profit Net profit Attributable to: Attributable to: Attributable to: Attributable to: Naspers Minorities *FY09 ZAR/US$ 8.79 (7.16) ZAR’mZAR’mZAR’mZAR’m US$’mUS$’mUS$’mUS$’m Mar 08 Mar 08 Mar 08 Mar 08 Mar 09 Mar 09 Mar 09 Mar 09 Mar 08 Mar 08 Mar 08 Mar 08 Mar 09 Mar 09 Mar 09 Mar 09 20,518 20,518 20,518 20,518 26,690 26,690 26,690 26,690 2,867 2,867 2,867 2,867 3,038 3,038 3,038 3,038 3,878 3,878 3,878 3,878 1,005 654 16 (279) 5,274 5,274 5,274 5,274 3,783 3,783 3,783 3,783 (303) 1,473 36 (214) 4,775 4,775 4,775 4,775 542 542 542 542 140 91 2 (39) 737 737 737 737 430 430 430 430 (34) 168 4 (24) 543 543 543 543 (1,378) (1,436) (193) (163) 3,896 3,896 3,896 3,896 3,339 3,339 3,339 3,339 243 (82) 4,057 4,057 4,057 4,057 3,418 3,418 3,418 3,418 639 639 639 639 127 2,965 6,431 6,431 6,431 6,431 5,762 5,762 5,762 5,762 670 670 670 670 544 544 544 544 34 (11) 567 567 567 567 478 89 380 380 380 380 14 337 732 732 732 732 656 76 35 Core headline earnings Headline earnings Treasury-settled share scheme charges Amortisation of intangible assets Fair value adjustments & currency translations Creation of deferred tax assets Mar 08 ZARm Mar 09 ZARm 3,806 3,065 47 410 -71 -244 258 958 1111 279 -58 1111 Increased amortisation mainly the result of the Allegro/Ricardo result of the Allegro/Ricardo acquisition in March 2008 2222 Profits earned from NetMed for the period prior to disposal Discontinued operations 48 -129 2222 Core headline earnings 3,996 4,373 36 Capital expenditure Capital expenditure Land, buildings & plant Transmission equipment Computer & office equipment Software Other (including vehicles, furniture) Mar 08 Mar 09 517 310 216 344 323 302 1111 158 182 20 76 1,221 1,221 1,221 1,221 1,227 1,227 1,227 1,227 1111 1111 Increased costs relate to investment in call centre capacity to service growing subscriber base 37 3 Ungeared balance sheet supports acquisitive expansion Significant FY09 acquisitions – mainly bolt-on purchases Company Company Company Company Country Country Country Country DateDateDateDate Total cost Total cost Total cost Total cost FC’mFC’mFC’mFC’m Total cost Total cost Total cost Total cost R’mR’mR’mR’m Percentage Percentage Percentage Percentage acquired acquired acquired acquired Effective Effective Effective Effective holding holding holding holding Accounting method Accounting method Accounting method Accounting method mail.ru Russia Dec-08 $100 1,030 10% 43% Equity accounted Vatera.hu Hungary Sep-08 € 16 Compera nTime/Yavox Brazil Jun-08 BRL 37 Molotok Buzzcity Nimbuzz Russia Dec-08 Singapore Aug-08 Holland Jul-08 $11 $10 € 7 Gadu Gadu Poland Jun-08 PLN 10 Other TOTAL 186 167 104 89 89 37 385 2,087 100% 100% Consolidated 54% 20% 25% 13% 54% 50% Consolidated Consolidated 25% Equity accounted 38% Equity accounted 3% 100% Consolidated 38 Internet Pay TV Technology Print Eastern Europe Western Europe South Africa Technology Newspapers & Magazines China 100% 43% Russia 80% 100% 85% Printing & Distribution 95% India Poland Sub-Sahara Africa Publishers & Agents 100% 100% 100% 97% 35% 94% 100% 100% 54% South Africa South Africa Thailand Brazil 30% 38% 30% Netherlands India South Africa Singapore 100% 25% Brazil, Magazines & Educational Publishing 30% China, various investments 39 Investor Relations contact details Meloy Horn Office: +27 11 289 3320 Mobile: +27 82 7727 123 E-mail: meloy.horn@naspers.com Website: www.naspers.com 40