Naspers Ltd Annual Report 2018

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FY2018 Annual Report · Naspers Ltd

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Integrated annual report 2018

In pursuit
of growth …

To view the online report,
please visit our website:

www.naspersreports.com

San Francisco, USA

… today …

Naspers is a unique and exciting
technology operator and investor.
We back entrepreneurs to build
digital technology platforms that
improve the lives of hundreds of
millions of people around the world.

GROUP REVENUES GREW

(1)

39%

to US$20.1bn(2)

CLASSIFIEDS
(excluding letgo)

became profitable during the
year, contributing to group
trading profit

TRADING PROFIT GREW

STRENGTHENED OUR POSITION

(1)

52%

to US$3.4bn(2)

in online food-delivery services
by investing a combined US$1.4bn
in Delivery Hero and Swiggy

CORE HEADLINE EARNINGS
WAS UP

VIDEO ENTERTAINMENT
(South Africa)

72%

at US$2.5bn

(2)

79%

of our revenue now comes
from our internet and
ecommerce activities(1)

Notes
(1) Growth in local currency, excluding M&A.
(2) Presented on an economic-interest basis.

contributed steady revenue
and trading profit growth

SOLD A

interest in Tencent, to reinforce
the balance sheet and pursue
growth opportunities, generating
proceeds of US$9.8bn

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201802

We have been growing our
business for a long time.
We know that decisions
we make today impact our
success tomorrow. Our ability
to act early on anticipated
global changes ultimately
determines our future.
Looking ahead, we are focused on:

Scaling our ecommerce
businesses (especially classifieds,
travel, payments and online
food delivery).

… tomorrow …

entertainment and media
businesses for a digital world.

2 Transforming our video-
3 Deploying machine learning
4 Hunting for the next wave

of growth through Naspers
Ventures.

(ML) and artificial intelligence
(AI) across all our businesses.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018… around

the world

From Brazil to India, Russia
to South Africa – we manage
our assets and allocate capital
to maximise growth.

We operate in more than

120markets and countries
24 887
>1.3bn

online users across our markets

employees

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201804

We are a global internet and entertainment
group and one of the largest and most successful
technology investors in the world. Operating
in more than 120 countries and markets with
long-term growth potential, we build leading
companies that empower people and enrich
communities. We run and invest in some of
the world’s leading digital platforms in internet,
video entertainment and media.

Naspers companies connect people to each
other and the wider world, help people
improve their daily lives, and entertain
audiences with the best of local and global
content. Every day, millions of people use
the products and services of companies we
have invested in, acquired or built, including
Avito, Brainly, Codecademy, eMAG, iFood,
letgo, Media24, Movile, MultiChoice, OLX,
PayU, Showmax, SimilarWeb, Swiggy,
Twiggle and Udemy.

Similarly, hundreds of millions of
people have made the platforms of
our associates a part of their daily lives:
Tencent (www.tencent.com; SEHK 00700),
Mail.ru (www.corp.mail.ru; LSE: MAIL),
MakeMyTrip Limited (www.makemytrip.
com; NASDAQ:MMYT) and Delivery Hero
(www.deliveryhero.com; Xetra: DHER).

Naspers is listed on the JSE Limited,
Johannesburg’s stock exchange (NPN.SJ),
and has an ADR listing on the London Stock
Exchange (LSE: NPSN).

Contents

About this report .................................................05

Group overview ....................................................07
Chair’s review ...........................................................09
Chief executive’s review ........................................ 11

The Naspers approach ....................................13

Business overview ................................................ 17
Our business model ............................................... 17
Reporting on the six capitals ..............................18
The world around us .............................................. 19
Engaging our stakeholders ..................................20
Active portfolio management ...........................26
Capital performance snapshot ..........................27
Value creation ..........................................................28
Tax ...............................................................................29

Performance review ........................................... 31
Internet .......................................................................33
Video Entertainment .............................................41
Media ..........................................................................45
Our people ................................................................49
Financial review........................................................51
Managing risks and opportunities ...................52

Governance ............................................................58
Our board ..................................................................59
Governance for a sustainable business ...........62
Remuneration report ............................................ 68

Summarised consolidated
annual financial statements ..........................92

Further information .........................................110
Notice of annual general meeting .................. 111
Form of proxy .........................................................114
Notes to the form of proxy ...............................115
Shareholder and corporate information .......116
Analysis of shareholders and
shareholders’ diary ............................................... 117

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201805

About this report

The Naspers integrated annual report assesses our performance
for the year to 31 March 2018, focusing on the value we created
for our key stakeholders. The aim is to provide a picture of our
progress and impact.

How it all fits together

We manage our business
with purpose, with an
innovative approach
to how we operate,
allocate capital, and
address key markets
and societal trends.

We measure our
performance by
evaluating how we
create value for our
key stakeholders,
taking account of
the six capitals …

… as identified in
the Framework of
the International
Integrated Reporting
Council: financial,
human, intellectual,
manufacturing …

… social and relationship,
and natural capitals, as
well as progress against
our strategy, and regularly
measuring returns on
invested capital.

We understand the
risks we take and
manage these to
minimise their impact
on our business and
results. Value creation
is the consequence of
how we …

… deliver financial
performance (outcomes)
and value (outputs) for
our stakeholders. This
is embedded in our
business model (page 17)
and integral to the
way we think and
make decisions.

We pursue growth by
building companies that
empower people and
enrich communities.

Financial

Human

Manufactured

Intellectual

Social and
relationship

Natural

The Naspers
approach

See page 13

Our business
model

See page 17

Stakeholder
engagement

See page 20

Value
creation

See page 28

Risks and
opportunities

See page 52

Governance

See page 58

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201806

About this report
continued

Listing information
Naspers has its primary listing on the
JSE Limited (the JSE) (NPN.SJ) in South
Africa, where it forms part of the Top
10 index and where most of its shares
trade. It also has a level 1 American
Depository Receipt (ADR) programme
listing on the London Stock Exchange
(LSE) (NPSN) and trades on an
over-the-counter (OTC) basis in the
United States. International investors
are therefore able to buy and sell
Naspers securities through the OTC
market, on the LSE or JSE (details on
page 4). Naspers’s direct wholly owned
subsidiary, Myriad International Holdings
B.V. (MIH BV), also has three bonds
listed on the Irish Stock Exchange (ISE).

Scope and boundary of reporting
Financial and non-financial reporting
The report extends beyond financial
reporting. It reflects on non-financial
performance, opportunities, risks and
outcomes attributable to or associated
with key stakeholders, which have
a significant influence on our ability
to create value.

It includes the financial performance
of Naspers Limited and its subsidiaries,
joint ventures and associates (the
group). The scope of reporting on
non-financial performance is indicated
in this report. Some South African
subsidiaries publish separate integrated
reports (www.multichoice.co.za and
www.media24.com). Group reporting
standards are continually being developed
to make disclosure meaningful and
measurable for stakeholders. Given the
highly competitive environment in
which the group operates, and the
impact of currency volatility on our
financial results, this report mostly
excludes financial targets or forward-
looking statements other than as
explained on page 6.

Where relevant, we have adjusted
amounts and percentages for the
effects of foreign currency, as well
as acquisitions and disposals.

Such adjustments (pro forma financial
information) are quoted in brackets
after the equivalent metrics reported
under IFRS. Refer to page 107 of
the summarised consolidated annual
financial statements for a reconciliation
of these metrics with the equivalent
amounts reported under IFRS. Financial
commentary and segmental reviews
are prepared on an economic-interest
basis (which includes consolidated
subsidiaries and a proportionate share
of associated companies and joint
ventures), unless otherwise stated.

The legislation and frameworks
that inform our reporting
The integrated annual report was
prepared against local and global
standards, including:

• Framework of the International

Integrated Reporting Council (IIRC):
this principles-based approach
promotes the concept of the six
capitals, which considers material
inputs and resources required to
create and sustain value in the long
term. We describe key components
of the Naspers value chain (business
model), which creates and sustains
value for our stakeholders.

• South African Companies Act 71 of
2008, as amended (the Companies
Act).

• King IV™ Report on Corporate

Governance for South Africa, 2016
(King IV™).

• International Financial Reporting

Standards (IFRS).

Materiality and material matters
We apply the principle of materiality
in assessing what information is to be
included in our integrated report. This
report focuses particularly on those
issues, opportunities and challenges that
impact materially on the group, as well
as its ability to be a sustainable business
that consistently delivers value to all key
stakeholders, including our shareholders.

Forward-looking statements
This report 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. By
their nature, forward-looking statements
involve risk and uncertainty because they
relate to future events and circumstances
and should be considered in light of
various important factors. While these
forward-looking statements represent
our judgements and future expectations,
a number of risks, uncertainties and
other important factors could cause
actual developments and results to differ
materially from our expectations. The
key factors that could cause our actual
results performance or achievements to
differ materially from those in the
forward-looking statements include,
among others: changes to IFRS and the
interpretations, applications and practices
subject thereto as they apply to past,
present and future periods; ongoing and
future acquisitions; changes to domestic
and international business and market
conditions such as exchange rate and
interest rate movements; changes in the
domestic and international regulatory
and legislative environments; changes to
domestic and international operational,
social, economic and political conditions;
the occurrence of labour disruptions and
industrial action and the effects of both
current and future litigation. We are not
under any obligation to (and expressly
disclaim any such obligation to) revise or
update any forward-looking statements
contained in this report, whether as a
result of new information, future events
or otherwise. We cannot give any
assurance that forward-looking
statements will prove to be correct and
investors are cautioned not to place
undue reliance on any forward-looking
statements contained herein.

Assurance
Financial information extracted from the
audited Naspers Limited consolidated
annual financial statements for the
year ended 31 March 2018 and
presented in this report was audited by
PricewaterhouseCoopers Inc. (PwC)
(refer to page 93 for the PwC report).
PwC also performed specific procedures
on the material non-financial information
contained in this report. South African
broad-based black economic
empowerment (BBBEE) information
wasassured by EmpowerLogic
(Naspers,MultiChoice and Media24).

The group has a combined assurance
model for internal use. Our combined
assurance model is designed and
implemented to cover the key risks
through a combination of assurance
service providers and functions as is
appropriate for Naspers.

An overview of combined assurance
per key risk is reported for consideration
by the joint audit and risk committees.

Our group internal audit and risk support
function has all controlled assets in scope.
The head of internal audit and risk
support reports to the audit committee
and presents for its approval an objective-
driven, risk-based internal audit plan.
Where required, external parties
support the internal audit function, such
as forensic specialists or data analytics
experts. Other external assurance
providers are enlisted on an as-needed
basis. In our more regulated businesses
(like PayU), regulatory inspectors visit
on a periodic, ongoing basis.

The audit committee appoints the
external auditor, reviews the auditor’s
independence annually and oversees
the external audit. The audit committee
makes recommendations to the board
in this regard and assists the board in
ensuring the integrity of external
reports. The annual chief executive/
CFO signoff process also covers
financial reporting.

Statement of the board of directors
on the integrated annual report

This report is primarily intended to address
the information requirements of long-term
investors (our equity shareholders,
bondholders and prospective investors).
We also present information relevant
to the way we create value for other key
stakeholders, including our employees,
customers, clients, regulators and society.

After being reviewed by the audit committee
and board, the board approved the
integrated annual report. The summarised
consolidated annual financial statements
were prepared in accordance with IFRS and
the Companies Act, while the integrated
annual report was prepared using the
IIRC framework and the recommendations
of King IV™. In our opinion, the integrated
annual report and annual financial
statements fairly reflect the financial
position of the group at 31 March 2018
and its operations for this period.

On behalf of the board

Koos Bekker
Chair

Cape Town
22 June 2018

Bob van Dijk
Chief executive

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018
07

Group

overview

Moscow, Russia

IntroductionGroup overviewThe Naspers approachBusiness overviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018Performance review08

Group overview

Our principal operations are in internet services, where we have
investments in social and internet platforms, but we predominantly
focus on ecommerce (especially classifieds, etail, travel, payments
and online food delivery), video entertainment and media.

Market leaders
We are market leaders in
many of the businesses and
markets where we operate.
Our most significant markets
are Africa, China, Russia,
Central and Eastern Europe,
North America, Latin
America, India, Southeast Asia
and the Middle East.

Internet

REVENUE

US$15.9bn

up 51%(1)

TRADING PROFIT

US$3.1bn

up 56%(1)

EMPLOYEES

13 739

Note
(1) Presented on an economic-interest basis with growth

in local currency, excluding M&A.

We operate internet platforms across a variety
of platforms and geographies. We focus on
ecommerce, but offer the full range of
internet-based services from communication
and social networking to entertainment and
mobile value-added services.
Our internet operations include:

Classifieds
Our footprint spreads across 41 markets.
Our companies OLX, Avito and letgo have
the number-one-ranked mobile classifieds
app in more than 22 countries.

Etail
This comprises our etail subsidiaries, eMAG
and Takealot and our associate, Flipkart.
Operations are spread across Central and
Eastern Europe, South Africa and India.

Online food delivery
This portfolio consists of online food
delivery businesses operating in more than
45 markets globally including iFood,
Delivery Hero and Swiggy.

Read more on
page 68

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018

Governance for a sustainable business
continued

Progress made and King IV™ milestones

2016

2017

November 2016 to June 2017
Analysis and review
• Interpreted King IV™ for the

Naspers environment. Detailed
King IV™ gap analysis conducted
at a Naspers group level.

• Reviewed Naspers board and

board committee charters, policies
and governance practices to align
to King IV™.

• Developed King IV™ and other
governance webinars on the
MyAcademy platform to promote
awareness. Other webinars
included training modules for
directors and on the JSE Listings
Requirements, data privacy and our
communications policy.

June 2017 to July 2017
Approval of charters and policies
• Consultation with and feedback from the MultiChoice
South Africa and Media24 boards and segment chief
financial officers and general counsels on Naspers’s
governance framework were incorporated.

• The reviewed policies and charters were approved by
the relevant board committees and ultimately the
board on 23 June 2017.

• King IV™ taskforce established, consisting of the group
company secretary, group general counsel, assistant
group company secretary, global governance partner,
head of internal audit and risk support and global
legal compliance lead. Initial King IV™ taskforce
workshop to formulate King IV™ implementation plan.

• Formulated Naspers’s good governance guidelines
requirements and practice guidelines (‘the good
governance guidelines’), setting out the key
governance elements subsidiaries need to observe as
part of the Naspers group governance framework.
The good governance guidelines consider
proportionality, as explained above.

2018

September 2017
to March 2018
Enhancing report
templates and
reports to board
committees

Aligned board committee reports
and enhanced reporting to board
committees to enable reporting
on King IV™ in the 2018 integrated
annual report and King IV™
application report.
Enhanced reporting to all board
committees, including to the risk
committee on legal compliance

and information and technology
governance (including data
privacy and cybersecurity)
and to the social and ethics
committee on organisational
ethics, stakeholder relationship
management, corporate
citizenship and
sustainable development.

April 2018
Finalise and approve
After year-end (31 March 2018), the
businesses will be required to sign off
through an annual sign-off process on the
extent of implementation of Naspers’s
guidelines and policies.

September 2017
to October 2017
Roadshows kicked off
Roadshows to in-scope subsidiaries to
communicate Naspers’s requirements as
set out in the Naspers group policies and
the good governance guidelines. In-scope
subsidiaries include Avito, eMAG, iFood,
Irdeto, Media24, Movile, MultiChoice
Africa, MultiChoice South Africa, Naspers,
OLX, PayU and Takealot.

April 2018
Future focus
Areas include continuous enhancement of
• Naspers’s governance guidelines.
• Reporting to the board, board

committees and in the integrated
annual report.

• Engagement with investors on

environmental, social and governance
(ESG) matters.

Nov

Jun

Jul

Sep

Oct

Mar

Apr

Ongoing interaction,
support and guidance

• Engagement with business on progress in
implementing guidelines and reporting
requirements.

• Support to business to implement policies

and principles.

• Regular reporting to taskforce, Naspers internal
overview control forum, board committees and
board on progress made in the implementation
of the King IV™ plan.

• Define what needs to be reported

to the board and board committees,
align committee reporting templates
and enhance reporting.

Approach to King IV™ rollout:
• Expectations on requirements to address gaps on current structure, processes and reporting were communicated to subsidiaries.
• Responsibilities assigned for different reporting areas to representatives in Naspers and group businesses.
• Reporting process, including reporting templates and tools, developed and distributed to Naspers subsidiaries.
• CFO and legal counsels in segments and subsidiaries responsible for leading the rollout in their segments and subsidiaries.
• Connecting King IV™ and other group initiatives, leverage on existing structures, processes and materials.

related matters via the Naspers ethics
officer, who is the central Naspers
contact for Naspers ethics matters, to
the social and ethics committee. Ethics
officers’ responsibilities include:

• Understanding and applying the code
of business ethics and conduct (the
code) and whistleblower policy.

• Upholding corporate values.
• Managing internal speak-ups and

providing guidance.

• Assisting with awareness campaigns

on the code and whistleblower policy.
• Maintaining confidentiality in relation

to ethics-related matters.

• Maintaining records and reporting on

ethics-related matters.

external whistleblower facility,
OpenLine, operated by Deloitte’s
Tipoffs Anonymous. Details of this
facility are published on the corporate
website, www.naspers.com. All
stakeholders can report unethical
behaviour and wrongdoing anonymously
and confidentially. The line operates
globally, 24/7/365 with live answering.

This year we embarked on an
awareness campaign across the group,
with the theme ‘It’s your business’. The
campaign led to our group companies
setting the tone of reporting unethical
business practices.

It’s your business/speak out

To facilitate disclosure of improper
conduct, Naspers has an independent

During the year we created awareness
on the code and whistleblower policy

throughout the group. In-scope
subsidiaries included Avito, Buscapé,
eMAG, iFood, Irdeto, Media24, Movile,
MultiChoice Africa, MultiChoice South
Africa, Naspers, OLX, PayU and
Takealot. The training methods used by
subsidiaries included elearning modules
on the MyAcademy platform,
face-to-face training, presentations and
storyboarding for disabled employees.
Elearning modules were translated into
Portuguese, Spanish and Russian.
Further translations planned include
Romanian and Bulgarian. In-scope
subsidiaries were determined based
on proportionality and maturity.

The Naspers social and ethics
committee receives reports on business
ethics management and monitoring –

Openline operates globally

Business ethics

The group’s code of business ethics
and conduct is available on
www.naspers.com.

This code applies to all directors and
employees in the group. Ensuring that
group companies adopt appropriate
processes and establish supporting
policies and procedures is an ongoing
process. Management focuses on
policies and procedures that address
key ethical risks, such as conﬂicts of
interest, accepting inappropriate gifts
and acceptable business conduct.

The social and ethics committee is
responsible for overseeing and
reporting on business ethics in relation
to the Naspers group, taking into
account specific disclosures and best
practice as recommended by King IV™.
Businesses in our group apply zero
tolerance to violations of the code by
taking the necessary action, including
improving the control environment or
taking the necessary disciplinary, criminal
or civil action. Reports are provided to
the social and ethics committee to
demonstrate this. Unethical behaviour
by senior employees is also reported to
the human resources and remuneration
committee, along with the way the
company’s disciplinary code was applied.

Naspers is committed to conducting its
business on the basis of complying with
the law, with integrity and with proper
regard for ethical business practices. It
expects all directors and employees to
comply with these principles and, in
particular, to avoid conflicts of interest
and not to engage in insider trading,
illegal anti-competitive activities, and
bribery and corruption.

During the year we designated 12 ethics
officers around the group. These
officers serve as central points of
contact for advice on ethics-related
queries, improprieties, allegations and
complaints. They report on ethics-

performance, using the six-capitals
reporting framework – refer to the
social and ethics committee report in
the full governance report. We
recognise that sustainable development
and economic, social and environmental
protection are global imperatives that
present both opportunities and risks for
business. We build leading companies
that empower people and enrich
communities. Corporate citizenship
is integral in the way we do business.

An overview of our capitals and value
creation is provided on pages 18 and 28.

Going forward, management will
enhance reporting techniques on
how it reports to the social and ethics
committee on responsible corporate
citizenship and sustainable development
using the six-capitals reporting framework.

Legal compliance

Legal compliance falls within the
responsibilities of the group general
counsel, who is also the chief legal
compliance officer. The Naspers board
has delegated the responsibility for

refer to the social and ethics committee
report in the full governance report.

Key areas of focus going forward include
regular engagement between the
group’s ethics officers, where they can
share experiences, identify ethics
challenges and share best practice.
This will establish a Naspers-designated
ethics officers’ community and assist us
in tailoring tools and support.

We plan to launch an ethics
reawareness campaign for in-scope
subsidiaries and to assess launching an
ethics-awareness campaign for other
subsidiaries, taking into account
proportionality.

Stakeholder relationships

Representatives of our businesses manage
various external and internal stakeholder
relationships. Our businesses manage
their stakeholder relationships based on
a stakeholder-inclusive approach that
balances the needs, interests and
expectations of material stakeholders
in the best interests of the businesses.

To support the board to fulfil its
governance role, the Naspers social and
ethics committee receives reports on
stakeholder management across the
group – refer to the social and ethics
committee report on page 21 of the
full governance report.

An overview of our stakeholders and
stakeholder engagement is provided on
page 20.

Sustainable development
and corporate citizenship

Naspers’s commitment to sustainable
development and corporate citizenship
is articulated in its sustainable
development policy. To support the
board to fulfil its governance role, the
social and ethics committee receives
reports on Naspers’s social and ethics

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201866

Governance for a sustainable business
continued

overseeing legal compliance to the risk
committee of the Naspers board. To
assist the risk committee in discharging
this responsibility, the chief legal
compliance officer reports on legal
compliance to the risk committee. Legal
compliance is a standing agenda point.
Responsibility for legal compliance in
each segment rests with the general
counsel of that segment, who oversees
legal compliance for the subsidiaries
within his or her segment.

During the 2017 and 2018 financial
years the group has been enhancing
its legal compliance framework by
identifying key legal compliance risks.
The enhancements respond to the
increased expectations of regulators
and stakeholders. In addition, they align
the group to market conditions, which
show a deepening of policies and
procedures as relevant areas of the
law and best practice become more
developed.

The legal compliance framework includes
the following:

• Groupwide policies that apply to every
legal compliance programme in the
group, built on the principles in the
code of business ethics and conduct.
Subsidiaries are responsible for
implementing a fit-for-purpose legal
compliance programme based on the
risks applicable to their business but, as
a minimum, containing these group
policies.

• A compliance toolkit including detailed
guidelines and resources based on the
group policies to be tailored by the
segments and businesses to reflect
local legal requirements and risks.

The legal compliance programme is led
by the chief compliance officer and global
compliance lead with support from
external consultants.

The enhanced groupwide legal
compliance, anti-bribery and anti-
corruption, sanctions and export
controls and competition compliance
policies were reviewed and approved by
the Naspers board in June 2017.

Assurance on the effectiveness of
compliance management is received
through a combined assurance model.

As part of the enhanced legal compliance
framework, each segment is required to
provide a quarterly legal compliance
report to the group legal compliance
function. This report includes an
overview of key compliance risk areas
and mitigating measures, key compliance
regulatory developments and material
compliance incidents and investigations.
The group legal compliance function
uses these reports to compile a
consolidated report that is reviewed
by the chief compliance officer and is
subsequently provided to the risk
committee of the Naspers board.

Planned areas of future focus for legal
compliance include continuing to raise
compliance awareness across the group.
Improvements to the legal compliance
framework will be made based on
emerging risks, feedback from
monitoring activities and a greater focus
on third-party screening. With internal
audit, we will also be focusing on our
assurance framework.

There were no material or repeated
regulatory penalties, sanctions or fines
for contraventions of, or non-
compliance with, statutory obligations.

There were no inspections by
environmental regulators or findings of
non-compliance with environmental laws.

To support the board to fulfil its
governance role, the Naspers risk
committee receives reports on legal
compliance – refer to the risk
committee report on page 27 of the
full governance report.

Information and technology
governance

Information and technology (I&T)
governance is integrated in the operations
of the Naspers businesses. Management
of each subsidiary or business unit is
responsible for ensuring effective
processes on I&T governance are in place.

The risk committee assists the board
with overseeing I&T-related matters. I&T
governance is a standing point on the risk
committee agenda. I&T objectives have
been included in the risk committee
charter. The risk committee considers
the risk register, as well as reports on I&T
from internal audit and risk support and
our legal compliance function.

The group’s subsidiaries are required to
act in line with Naspers’s good
governance guidelines, which, among
others, detail I&T governance-related
matters. Subsidiaries of each major entity
are required to submit an annual formal
written report on the extent to which
they have implemented the principles,
and chief executives and CFOs sign off
thereon. Any notable exceptions are
summarised and reported to the risk
committee.

We continuously look at how we can
better integrate people, technologies
and processes. During the year, we have
made further progress in implementing
SAP across the group to unify key
finance business processes. During our
annual business planning process, our
various businesses consider their
platform requirements. The platform
strategy starts from the business
strategy and is translated into technical
and process requirements.

Business continuity is included in the
group’s risk register, which is reviewed
and discussed by the risk committee
twice a year and, annually, by the board.
Business resilience is the key objective
of our cybersecurity policy. The

capability of businesses to respond to
disruption is in scope for internal audit,
bearing in mind the perspective of our
customers and end users.

A comprehensive code of business ethics
and conduct is in place. In addition, the
operational boundaries to dealing with
I&T are subject to the group’s legal
compliance policy. Our risk management
practices ensure that relevant risks
relating to the ethical and responsible use
of technology and information are
identified and assessed. Our social and
ethics committee oversees this area. We
are running a privacy programme to
ensure that the personal data of our
suppliers, customers and employees is
stored and processed in an ethical
manner and in compliance with relevant
privacy laws. A key focus for the new
financial year is the Protection of
Personal Information (PoPI) Act, which
promotes the protection of personal
information by public and private bodies
in South Africa and General Data
Protection Regulation (GDPR), a
regulation in the European Union (EU)
on data protection and privacy for all
individuals within the EU addressing the
export of data outside the EU.

Internal audit provides assurance to
management, the audit committee and
the board on the effectiveness of I&T
governance. The detail of controls to
manage identified risks and reduce
vulnerability forms the basis of internal
audit’s assurance plans.

To support the board to fulfil its
governance role, the Naspers risk
committee receives reports on I&T
management – refer to risk committee
report on page 27 of the full
governance report.

Planned areas for future focus for I&T
governance include the development
and deployment of data-driven
technologies (such as machine learning
and artificial intelligence), cybersecurity
and data privacy.

Penalties

Because MultiChoice operates in a
highly regulated environment in South
Africa, compliance is important. The
company participates in the regulatory
process affecting its industry through
various public forums and debates,
providing inputs on formulating standards
and strategies for the industry.

MultiChoice and M-Net received fines
from the self-regulatory body, the
Broadcasting Complaints Commission
of South Africa (BCCSA). These relate
to failure by channels to provide correct
classification information, resulting in
MultiChoice and M-Net contravening
the BCCSA Code.

Fines paid to the BCCSA:

• 2016 financial year: R10 000
• 2017 financial year: R90 000, and
• 2018 financial year: Rnil.

Several media industry players, including
MultiChoice and Media24, have settled
the industrywide advertising discounts
matter with the Competition
Commission of South Africa, entering
into consent agreements with the
Competition Commission. The
agreements were approved by the
Competition Tribunal. DStv Media Sales
Proprietary Limited (DMS), a subsidiary of
MultiChoice, agreed that an administrative
penalty of R22m be paid (provided for in
the prior financial year) and a contribution
of R8m, payable over three years, to a
fund to be administered through an
industry trust to assist small black-owned
media agencies. Media24 agreed to pay
R14m and R5m respectively.

During the past year there were no
environmental accidents, nor were any
environment-related fines imposed by
any government.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201867

Governance for a sustainable business
continued

Internal control systems

As part of the overall management of
risk, the system of internal controls in all
material subsidiaries and joint ventures
under the company’s control aims to
prevent and detect any risk materialising
and to mitigate any adverse
consequences thereof. The group’s
system of internal controls is designed
to provide reasonable, and not
absolute, assurance on the achievement
of company objectives, including
integrity and reliability of the financial
statements; to safeguard, verify and
maintain accountability of its assets; and
to detect fraud, potential liability, loss
and material misstatement while
complying with regulations. For those
entities in which Naspers does not have
a controlling interest, the directors
representing Naspers on these boards
seek assurance that significant risks are
managed and systems of internal
control are effective.

All internal control systems have
shortcomings, including the possibility of
human error or ﬂouting of control
measures. Even the best system may
provide only partial assurance. In the
dynamic environment in which the
company operates, management
regularly reviews risks and the design of
the internal controls system to address
these, assisted by the work and reports
from internal audit on the adequacy and
operational effectiveness of controls,
which may indicate opportunities for
improvement. The external auditor
considers elements of the internal
controls system as part of its audit and
communicates deficiencies when
identified.

The board reviewed the effectiveness
of controls for the year ended 31 March
2018, principally through a process of
management self-assessment, including
formal confirmation in the form of
representation letters by executive
management. Consideration was given

to input, including reports from internal
audit and the external auditor,
compliance and the risk management
process. Where necessary, programmes
for corrective actions have been
initiated.

Nothing has come to the attention of
the board, external or internal auditors
to indicate any material breakdown in
the functioning of internal controls and
systems during the year under review.

Internal audit

An internal audit function is in place
throughout the group. The head of
internal audit reports to the chair of
the Naspers audit committee, with
administrative reporting to the financial
director. A large part of the internal
audit fieldwork is co-sourced.

Internal audit annually provides a
statement on the effectiveness of
Naspers’s governance, risk management
and control processes to the audit
committee. An independent review on
internal audit is done at least every five
years. The last review was performed
by PwC in 2017. The head of internal
audit and risk support confirms annually
to the board that internal audit
conforms to meet the International
Standards for the Professional Practice
of Internal Auditing of the Institute of
Internal Auditors and its code of ethics.

Non-audit services

The group’s policy on non-audit
services provides guidelines on dealing
with audit, audit-related, tax and other
non-audit services that may be provided
by Naspers’s independent auditor to
group entities. It also sets out services
that may not be performed by the
independent auditor.

The audit committee preapproves audit
and non-audit services to ensure these
do not impair the auditor’s
independence and comply with
legislation. Under our guiding principles,
the auditor’s independence will be
deemed impaired if the auditor
provides a service where he/she:

• functions in the role of management

of the company, or

• audits his/her own work, or
• serves in an advocacy role for the

company.

Company secretary

The company secretary, Gillian
Kisbey-Green, and David Tudor, group
general counsel (and legal compliance
officer), are responsible for guiding the
board in discharging its regulatory
responsibilities.

Directors have unlimited access to the
advice and services of the company
secretary. She plays a pivotal role in the
company’s corporate governance and
ensures that, in accordance with the
pertinent laws, the proceedings and
affairs of the board, the company itself
and, where appropriate, shareholders
are properly administered. She is also
the company’s compliance officer as
defined in the Companies Act and
delegated information officer. The
company secretary monitors directors’
dealings in securities and ensures
adherence to closed periods. She
attends all board and committee
meetings. In accordance with King IV™
the performance and independence of
the company secretary is evaluated
annually.

to provide forward-looking information.
Naspers complies with legislation and
stock exchange rules on forward-
looking statements.

Closed periods
Naspers would typically be in a closed
period on the day after the end of a
reporting period (30 September or
31 March) until the release of results.
General investor interaction during this
time is limited to discussions on strategy
and/or historical, publicly available
information.

Analyst reports
To enhance the quantity and quality of
research, Naspers maintains working
relationships with stockbrokers,
investment banks and credit-rating
agencies – irrespective of their views
on or recommendations to the group.
Naspers may review an analyst’s report
or earnings model for factual accuracy
of information in the public domain, but
in line with regulations and group policy
we do not provide guidance or
forecasts.

The board encourages shareholders to
attend the annual general meeting,
notice of which is contained in this
integrated annual report, where
shareholders have the opportunity to
put questions to the board,
management and the chairs of the
various committees.

The company’s website
www.naspers.com provides the
latest and historical financial and other
information, including financial reports.

As required by JSE Listings Requirement
3.84(h), the board has determined that
the company secretary, who is a
chartered accountant (SA) with more
than 25 years’ company secretarial
experience, has the requisite
competence, knowledge and
experience to carry out the duties of a
secretary of a public company and has
an arm’s length relationship with the
board. The board is satisfied that the
arrangements for providing corporate
governance services are effective.

Investor relations

Naspers’s investor relations policy can
be found on www.naspers.com. It
describes the principles and practices
applied in interacting with shareholders
and investors. Naspers is committed to
providing timely and transparent
information on corporate strategies and
financial data to the investing public. In
addition, we consider the demand for
transparency and accountability on our
non-financial (or sustainability)
performance. In line with King IV™, we
recognise that this performance is based
on the group’s risk profile and strategy,
which includes non-financial risks and
opportunities.

The company manages communications
with its key financial audiences, including
institutional shareholders and financial
(debt and equity) analysts, through a
dedicated investor relations unit.
Presentations and conference calls take
place after publishing interim and final
results.

A broad range of public communication
channels (including stock exchange
news services, corporate website,
press agencies, newswires and news
distribution service providers) is used
to disseminate news releases. These
channels are supplemented by direct
communication via email, conference
calls, group presentations and
one-on-one meetings. Our policy is not

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201868

Remuneration report for the year ended 31 March 2018

“We aim to attract,
motivate and retain
the best leaders,
entrepreneurs,
creative engineers
and employees to
create sustainable
shareholder value.”

Craig Enenstein
Chair: Human resources and
remuneration committee

Dear Shareholder

On behalf of the board, I am pleased
to present our 2017/18 remuneration
report.

This report is my first in the chair of the
human resources and remuneration
committee. I welcome fellow directors
Emilie Choi and Roberto Oliveira de
Lima to the committee and thank the
outgoing chair, Rachel Jafta and alternate
committee member, Cobus Stofberg,
for their contributions.

This year, we have revised our approach
in order to demonstrate more clearly
the link between Naspers’s strategy,
performance and our remuneration
philosophy. This report is designed to
be easier to understand and to ensure
greater transparency regarding how we
pay our executives. We are grateful to
our shareholders for their input, which
was considered carefully. Changes
include a total view of executive
remuneration, greater transparency
on the short-term incentive goals
of executive directors and more
information on how we assess
performance throughout the group.

We have incorporated changes to
ensure compliance with the King IV™
guidance, which is effective from 1 April
2017. In line with King IV™, our 2017/18
remuneration report is split into three
sections:

1. The background statement:
Provides an overview of pay
outcomes for 2017/18 and our
approach for 2018/19.

2. The remuneration policy:
Provides information on the
components of our executive-pay
packages.

3. The implementation report:
Sets out information on how we
implemented our policy in 2017/18.

We have made several changes to the
design of executive remuneration for
the forthcoming 2018/2019 financial
year. These are detailed in sections 1
and 3. When making executive awards,
the committee has considered the need
to maximise shareholder value. Details
of the cost of our long-term incentives
can be found on page 90.

We engaged external advisors to
provide advice on executive
remuneration and the committee is
satisfied that they are objective and
independent.

Our strategy drives our pay principles
Across our group, we use technology to
provide new and exciting ways for our
customers to be informed, entertained
and to trade online. As one of the
largest technology investors in the
world, operating in more than 120
countries, we focus on high-growth
markets and we invest in local,
empowered teams with an ownership
mentality. Our business moves fast as
technology trends and consumer
adoption changes, and we seek to run
businesses that have broad potential,
can address big societal needs and can
attain market leadership over time.

Our people are at the heart of our
success. Without the driven
entrepreneurs with whom we partner,
the digital leaders who drive us forward
and the skills our people bring to the
group in highly specialised areas such
as technology development, product
design, machine learning and artificial
intelligence, content rights, digital
marketing and many other disciplines,
we would not be able to compete as
effectively as we do. We operate in a
highly competitive, global market for
this type of talent, and we compete
against other world-class companies
for great people.

How we add value
We pursue growth by building leading companies
that empower people and enrich communities.

What we do:

Partner with
entrepreneurs

Optimise

Invest

Create
sustainable
leadership
positions

Build businesses
with broad
potential

Focus on
high-growth
markets

Grow

Address big
social needs

Underpinned by our active capital allocation and strategy.

We ensure we optimise our portfolio for growth and competitiveness.
Read more on page 26

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201869

Remuneration report for the
year ended 31 March 2018
continued

Our remuneration philosophy
Our remuneration philosophy
underpins our group’s strategy and
enables us to achieve our business
objectives. Our commitment to pay
for performance and alignment with
shareholder value creation drives all our
remuneration activities, and supports
the ownership mentality and spirit of
entrepreneurship in our teams around
the world. We believe in a level playing
field for our people. As much as
possible, the structure of our pay is
similar, regardless of the seniority of
the employee.

We endeavour at all times to balance
the need to compete globally for the
very best talent with the need to pay
fairly and responsibly. We welcome
the opportunity to discuss this policy
and its outcomes with our stakeholders.

Craig Enenstein
Chair: Human resources and
remuneration committee

22 June 2018

1. Background statement: The Naspers approach to remuneration
Our pay principles
Five principles guide our remuneration approach.

The Naspers approach to remuneration

We believe in pay for performance; we are comfortable with
bigger rewards for those that make the highest contribution

Remuneration must be aligned with shareholder outcomes

Remuneration must incentivise the achievement of strategic,
operational and financial objectives, in both the short and
long term

We are consistent; our reward package elements are
broadly the same, regardless of seniority*

Our reward systems must help us attract and retain the best talent
around the world in a fair and responsible way

* Some hourly-paid employees do not receive long-term incentives.

In practice, this means that we take into
account sectoral, regional and local
practices as well as the needs of the
business and the calibre of the individual
when implementing our pay framework.

The way we structure pay is purposely
linked to our strategy and to the
delivery of long-term sustainable
growth to our shareholders.

Our pay principles are applied through
three key elements and executive pay
is heavily weighted towards long-term
performance with a significant
proportion delivered in share
appreciation rights or share options,
and with every award subject to
individual performance.

Our approach to long-term incentives
ensures that both the value of individual
businesses and the overall performance
of the group are considered. We are
making significant progress following
capital investment in several areas, and
we believe that there is greater strength
in being one large group, rather than
a series of individual companies. The
delivery of sustainable value to our
shareholders will depend on the value
of our business units which will
ultimately be reflected in the value of
the group as a whole over the longer
term. Executives only receive payouts
under our long-term incentive plans
when the value of underlying assets
or the Naspers share price increases.

When making executive-pay decisions,
we consider the individual’s
performance and the performance
of the business, the complexity of the
responsibilities of the executive, and
the growth trajectory and life cycle
stage of the business for which he/she
is responsible.

Pay for
performance

Shareholder
alignment

Incentivisation

Consistency

Attract and
retain talent

Notes
(1) Some LTI schemes associated with underlying
assets in which the group has a minority
shareholding are not aggregated into the
executive director schemes. There is no annual
participant liquidity in these schemes. In some
limited cases executive directors have received
an award directly in those schemes to ensure
that they are incentivised to deliver appropriate
returns on invested capital in those businesses.
(2) All awards made from September 2017 onwards
in Naspers SOs have a four-year-phased vesting
period. Awards made prior to this time have a
five-year vesting period with vesting at the end
of years three, four, and five.

Remuneration report for the
year ended 31 March 2018
continued

Our remuneration structure
We have outlined the three elements of pay for our executive directors below, and the approach is similar for the chief
executive’s direct reports. The same principles are applied to employees across the group.

Pay principle

(1) Base salary (or
total cost to
company (TCTC))

(2) Short-term
incentives (STIs):
Annual
performance-
related incentive
or short-term
incentive

(3a) Long-term
incentives
(LTIs): Share
appreciation
rights (SARs)

• Base salary = fixed pay, with the cost of employers’ taxes and employee benefits in addition.

Note: the fixed pay of employees in South Africa is quoted in terms of TCTC, which
includes the cost of employers’ taxes and employee benefits.
• Personal performance is the primary driver for pay increases.
• Set at a level to ensure we can attract and retain talent of the required calibre.
• Takes into account regional, local and sector practice as well as an individual’s

contribution.

• We operate an annual incentive plan that pays out depending on performance achieved

against strategic, operational and financial objectives.

• The purpose of the annual incentive plan is to ensure executive alignment with and focus on
the annual board-approved business plan. We believe that the achievement of these annual
plans will cumulatively drive long-term shareholder value.

• The same structure is applied throughout the organisation to ensure a consistent
approach with measures linked to an individual’s role so that pay is linked to their
contribution.

• A long-term incentive that pays out based on the growth in value of the business units or

an aggregation of underlying assets in a division (eg Ecommerce).

• Wherever possible, the long-term SAR incentives for executive directors are based on an
aggregation of underlying assets so that any value upside delivered by individual businesses
are offset by any value downside delivered by other businesses, thus ensuring that senior
executives are negatively affected should individual businesses not perform(1).
• Awards are made to individuals based on their contribution to the business.
• Any gains are settled in Naspers shares, which are acquired on the market for cash.
• The change in value is measured over a four- or five-year period to ensure focus on the

long-term delivery of shareholder value.

(3b) Long-term
incentives
(LTIs): Naspers
share
options (SOs)

• Long-term awards made in Naspers’s SOs with payouts based on the growth in Naspers’s

share price over a four- or five-year period(2).

• The vesting period has been determined taking into account practice in companies with

which we compete for talent.

• Provides long-term alignment with Naspers’s shareholders as value is only delivered to

participants if there is an increase in the share price.

The human resources and remuneration committee considers that the remuneration policy continues to achieve its
objectives of aligning pay with long-term performance of Naspers and shareholder outcomes.

Remuneration focus areas and key decisions in 2017/18
The following table outlines the key areas of focus and key decisions taken by the human resources and remuneration committee during the 2017/18 financial year:

Note
(1) Ad hoc share-based incentive scheme governance
matters are dealt with as and when they arise.

Meeting

April 2017

June 2017

Key areas of focus and decisions(1)

• Approval of the directors’ fees for the following financial year: For
consideration by the board and subsequent shareholder approval.

• Approval of the annual performance incentive KPIs for senior

executives for the forthcoming financial year.

• Performance and total compensation review of senior executives.
Decision on previous-year performance and short-term incentive
payout, salary increases and long-term incentive awards.

• Consideration and approval of the annual long-term share-based

incentive scheme awards to be made to employees in the Naspers
group and long-term share-based incentive scheme limits.

• Review of SAR scheme valuations completed by Deloitte (report of
valuations subcommittee) (see page 79 for a detailed description of
the valuations process for SAR schemes).

• Governance matters: Ethics performance, review of committee’s

effectiveness in terms of compliance with the committee’s charters
and review of committee’s compliance with the committee charters
of the major subsidiary companies.

• As part of the King IV™ implementation project: Review of

committee charters and review of committee charters of the major
subsidiary companies.

• Governance matters: Review of the remuneration policy.
• Review of policies required to be reviewed by this committee,
including but not limited to, the remuneration policy and board
diversity policy.

August 2017

• Market practice update on governance and executive pay.

November 2017

• Shareholder feedback from the remuneration report for the past

financial year.

• Succession planning for senior executives.

February 2018

• Consideration of recommendation on directors’ fees from external

advisors for budget purposes.

• Executive remuneration design considerations for the 2019 financial

year.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201872

Remuneration report for the
year ended 31 March 2018
continued

Business performance and remuneration outcomes in respect of 2017/18

Our strategy

• We build businesses with

• Partnering with local teams and entrepreneurs

big potential that address societal needs

• Achieving leadership positions in high-growth markets

Notes
(1) The normal bonus target is 50% of TCTC.
This year there was an additional variable
bonus capped at 25% of TCTC for obtaining
new general funding.

(2) Fair value: this represents the value of the share
option or share appreciation right on grant date.

Our business
priorities

• Classifieds
• Video Entertainment
• Food Delivery

• Fintech
• Travel
• B2C Ecommerce

Our financial
highlights

• Revenue US$20.1bn, up 38% (and 39% in local currency, excluding M&A).
• Trading profit up 51% to US$3.4bn (up 47% and 52% in local currency, excluding M&A).

• Core headline earnings, the board’s measure of sustainable operating performance,

was up 72% on last year at US$2.5bn.

• Consolidated development spend down by 17% to US$669m.

Our operating
highlights

• Ecommerce financial performance

• Food Delivery

Revenue increased 25% (36%) year on year to US$3.6bn with Classifieds, B2C
(business-to-consumer), Payments and Food Delivery contributing meaningfully to the
segment’s 9% revenue-growth acceleration on the prior year.

• Classifieds

Excluding the investment to scale letgo, the Classifieds business turned profitable.

• B2C

eMAG Romania reached profitability.

• Payments

Reduced trading loss by 42% on the existing footprint and in local currency.

Solidified food-delivery focus through investments in Delivery Hero and Swiggy.

• Travel

MakeMyTrip’s revenue, in local currency and adjusted for the merger with ibibo last
year, grew by 21% year on year to US$222m on the back of healthy growth in its airline
ticketing, and hotels and packages businesses.

• Video Entertainment

Revenue for the segment increased 8% (7%) to US$3.7bn and trading profit rose 29%
(24%) to US$369m. Recorded a stable performance, adding just over 1m direct-to-
home (DTH) subscribers and 520 000 digital terrestrial television (DTT) subscribers.

Remuneration
outcome

• 80% STI achievement (CEO).
• 4% base salary/TCTC increase (CEO/CFO).
• LTI award CEO(2)

Naspers N share options R70m.
Naspers Global Ecommerce SARs US$4,8m.

• 83% STI achievement (CFO)(1).
• LTI award CFO (2)

Naspers N share options R38m.
Naspers Global Ecommerce SARs US$2,5m.

• 21% value appreciation Naspers Global Ecommerce Share Appreciation Rights Plan.

Group financial performance(1)
Our principal operations are in internet
services, where we have interests in
listed assets, but predominantly focus
on ecommerce (especially online
classifieds, fintech, food delivery,
business-to-consumer (B2C)
ecommerce and new ventures including
edtech), video entertainment and
media. 79% (2017: 73%) of our revenue
now comes from our internet and
ecommerce activities, on an economic-
interest basis. Consolidated revenue
(excluding equity-accounted
investments) increased 9% (15%),
mainly due to strong performances by
the ecommerce businesses that grew
their consolidated revenues by 15%
(32%). Performance highlights include:

• Classifieds: OLX continued to grow

Across our consumer internet
businesses, we compete against both
local and global ‘tech titans’. Reaching
scale consumer internet businesses
relatively quickly, in terms of consumer
numbers and markets served, is of
paramount importance in this
environment. It requires significant
investment and often involves incurring
losses in the early years. We make a
deliberate choice to invest in these
businesses, knowing that short-term
profitability and free cash flow will be
negative. As such the financial
architecture is quite different to some
of our older businesses such as video
entertainment or print media. The
diversity in our portfolio allows us to
sustain this investment phase. Once
scale is reached, profitability follows.

around the world and turned
profitable in the year (excluding letgo).

• Etail: We achieved strong growth
across all our etail businesses and
eMAG’s Romanian business became
profitable. Post year-end we signed an
agreement to sell our stake in Flipkart
for US$2.2bn, representing an IRR
of 32%.

• Travel: MakeMyTrip strengthened

its leadership in India.

• Payments: PayU enjoyed healthy
growth, with TPV exceeding
US$25bn, and made key investments
in Kreditech and Remitly.

• Online food delivery: We continued
to invest in this promising sector,
including a 22% stake in Swiggy and
23.75% stake in Delivery Hero.
• Video Entertainment: Subscribers
increased by 1.5m year on year –
we now have over 13m subscribers
across Africa. Profitability grew 29%.
• Media24 (excluding Novus) revenues
were flat at US$374m and the larger
portion of Media24’s investment in
Novus was unbundled.

• Other: We continued to invest in key

opportunities such as edtech.

Note
(1) Where relevant, we have adjusted amounts
and percentages for the effects of foreign
currency, as well as acquisitions and disposals.
Such adjustments (pro forma information) are
quoted in brackets after the equivalent metrics
reported under IFRS.

The performance of the scheme
was relatively flat when many of our
consumer internet businesses were in
an investment phase. As more
businesses reach profitability and scale,
value increases and this is reflected in
the scheme’s performance post 2016.

The video-entertainment share
appreciation rights scheme value reflects
the results of both the MultiChoice
South African and sub-Saharan African
businesses. The decline in the value of
this scheme is in line with short-term
expectations and is mostly due to
negative macroeconomic conditions in
2015 and 2016 with most currencies
devaluing, GDP growth stalling, increased
competition, and other factors affecting
consumers. The sub-Saharan Africa
business is currently implementing its
turnaround value strategy that is seeing
improved operational performance and
subscriber growth. However, it will take
time for the strategy to have a material
positive impact on the financial results
of this segment. The group remains
committed to the strategy and in the
medium term, the segment should see
a positive return to growth.

The impact of business performance on long-term incentives
The following graph shows how the valuation of some of our main long-term
incentive (LTI) schemes has changed over time, reflecting business performance.

Value progression of long-term incentive schemes over time
(index linked)

Global ecommerce share appreciation rights value (US$)

% Naspers share price (US$)

Video-entertainment share appreciation rights value (US$)

1
o
t
d
e
s
a
b
e
r
h
t
w
o
r
g
e
v
i
t
a
l
e
R

2.5

2.0

1.5

1.0

0.5

31 March 2014

31 March 2015

31 March 2016

31 March 2017

31 March 2018

Annual year-end valuation date

More than 80% of the total compensation of the chief executive is delivered
through long-term incentives. On page 78, we show all the LTI schemes from
which awards have been made historically to the chief executive, CFO and CIO.

The Naspers global ecommerce schemes are designed to incentivise employees
who render services across the internet segment. The global ecommerce scheme
is effectively a sum-of-the-parts of the various underlying assets. In this way the
participants are exposed to the portfolio of assets as a whole (upside and
downside) as opposed to each individual asset in isolation. We believe this drives
the right behaviour and ensures the focus is the success of the segment as a whole
as opposed to an individual asset focus only.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018

Remuneration report for the
year ended 31 March 2018
continued

Executive director remuneration in 2017/18

Value released/vested in long-term incentive schemes in financial year 2017/18(2)

GUARANTEED
FIXED PAY

Base salary/
TCTC
benefits

Annual
performance-
related incentive
(STI)

Long-term
incentives: share
appreciation
rights (SARs)
and/or share
options (SOs)

Total
remuneration

Element

Naspers share options

Share appreciation rights

Bob van Dijk
(US$’000)

Basil Sgourdos
(US$’000)

Mark Sorour(1)
(US$’000)

14 467

9 017

933

233

1 807

322

Notes
(1) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director.
(2) Fair value on date of grant.

Total remuneration for executive directors for financial year 2017/18

Element

FY17

FY18

FY17

FY18

FY17

FY18

Bob van Dijk
(US$’000)

Basil Sgourdos
(US$’000)

Mark Sorour(1)
(US$’000)

Salary/Total cost
to company

Pension

Benefits

1 104

1 332

828

862

682

223

719

223

Short-term incentives

973

1 064

443

605(2)

1 718

1 904

Long-term incentive
plan(3)

10 403

9 636

1 752

1 954

958

778

Total single figure

12 605

12 178

3 128

3 529

2 633

3 634

Notes
(1) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director.
(2)
Includes an additional variable bonus capped at 25% of TCTC relating to obtaining new general funding.
(3) Fair value: represents the value of the option on grant date in accordance with IFRS.

Implementation of the policy in 2018/19
Below we show the remuneration package of the executive directors for financial
year 2019 as approved by the human resources and remuneration committee
in June 2018.

Fixed pay

Salary

Total cost to company

Bob van Dijk
(US$’000)

Basil Sgourdos
(US$’000)

1 385
(4% increase)

–

1 009
(4% increase)

Design changes for financial year 2019

Clawbacks
From financial year 2019, a two-year clawback provision
on STI and LTI will be introduced for the chief executive
and his direct reports.

Chief executive LTI holding requirement
From financial year 2019, the chief executive will be required to
maintain a Naspers shareholding of 10 times annual salary.

Further details can be found on page 90.

In conclusion
In the past year, acknowledging
increased focus globally into
remuneration practices and disclosures,
we have actively listened to our
shareholders’ feedback on pay and, as a
result of this, our focus as a committee
will continue to be to ensure that there
is a clear and demonstrable link
between pay and performance.

We remain committed to maintaining
an ongoing dialogue with our
shareholders and welcome any
feedback that they may have.

Performance measures

Bob
van Dijk

Basil
Sgourdos

50%

50%(1)

50%

Financial

Operational
and strategic

Note
(1) An additional variable bonus, capped at
25% of total cost to company relating to
obtaining new general funding, applies.

Long-term incentives (LTI)
– share options (SOs)

• Based on Naspers’s

total share price

• Four- or five-year phased

vesting

Implementation of policy in 2018/19

Short-term incentives (STI)
• Based on financial, operational and

strategic performance targets
which are tailored for each role

• Awards paid out in cash

Maximum opportunity
• 100% of salary for the chief

executive

• 100%(1) of total cost to company

for the CFO

Note
(1) An additional variable bonus, capped at
25% of total cost to company relating to
obtaining new general funding, applies.

Long-term incentives (LTI)
– share appreciation
rights (SARs)

• Based on the total value of the

discrete assets within the
ecommerce scheme. Any upside
in value created is offset
by any downside in the value
delivered by individual businesses
• Four- or five-year phased vesting

* Total cost to company is fixed pay comprising

base salary and non-cash benefits.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201876

Remuneration report for the
year ended 31 March 2018
continued

2. Remuneration policy
In this section we present the
remuneration policy for our executive
directors and an overview of the
groupwide remuneration policy.

During the 2017/18 financial year, we
carried out a comprehensive shareholder
consultation exercise to actively listen to
our shareholders’ views on remuneration.

One of the consistent themes raised by
our shareholders related to the disclosure
of senior executive remuneration and
how this links to the strategy of the overall
group. As a direct response to this, we
have significantly increased our disclosure
on remuneration.

Below is a summary of the disclosure
changes we are implementing for our
executive directors for the 2018/19
financial year, together with the
associated rationale.

• A clearer link between strategy,

business performance, remuneration
design and remuneration outcomes.

• More information on the various

elements of our compensation system
and in particular how we manage and
assess performance.

• Greater visibility on fixed pay, versus

pay at risk.

• On our STI, more information on
the annual performance goals for
executive directors and their level
of achievement.

• On our LTI:

– greater clarity about the long-term

incentive schemes executive
directors participate in

Our remuneration principles
The group has an integrated and balanced approach to its reward strategy that
aligns all stakeholder interests, both internal and external. Accordingly, individual
reward components are linked to business-specific value drivers of the group.
When considering our approach to pay, our overarching principles are as follows:

The Naspers approach to remuneration

We believe in pay for performance; we are comfortable with bigger
rewards for those that make the highest contribution

Remuneration must be aligned with
shareholder outcomes

Remuneration must incentivise the achievement of strategic,
operational and financial objectives, in both the short and long term

We are consistent; our reward package elements are
broadly the same*

Our reward systems must help us attract and retain the best
talent around the world in a fair and responsible way

* Some hourly-paid employees do not receive LTIs.

There are many business units within the Naspers group which are at different
levels of maturity. Individual business units are therefore responsible for developing
their own policies within the overall group remuneration framework according to
the principles set out above as well as local laws, taking account of regional, local
and sector practice.

– more information on how we assess
the valuation of our share appreciation
rights schemes and on the
governance of the LTI schemes, and
– introducing a view of an index-linked
progression of the main long-term
incentive schemes, over time.

The remuneration package of our executive directors is designed to be principally
focused on long-term remuneration which only pays out subject to value being
delivered in both the underlying business units and the group as a whole. For
example, for the 2017/18 financial year 80% of the chief executive’s remuneration
was delivered in share options or share appreciation rights. Over time, incentives
only deliver value to the chief executive when the value to the shareholder
also increases.

Our remuneration and employment
policies
Recruitment policy
On the appointment of a new
executive director, their package will
typically be in line with the policy as
outlined above. To facilitate
recruitment, it may be necessary to ‘buy
out’ remuneration forfeited on joining
the company. This will be considered on
a case-by-case basis and may comprise
cash or share options/share
appreciation rights.

Termination policy
Payments in lieu of notice may be made
to executive directors comprised of
salary or total cost to company (South
African employees) for the unexpired
portion of the notice period. Such
payments may be phased. On cessation,
there is no automatic entitlement to an
annual performance-related incentive
(bonus), however the committee
retains the discretion to award a bonus
to a leaver during the financial year
taking into account the circumstances of
their departure. There is no entitlement
to a particular severance package
provided for in the service contract of
executive director or senior managers.

Ensuring a fair and responsible
approach to pay
To ensure a fair and reasonable
approach to the remuneration of
executive directors in the context of
the wider group, in practice the
committee takes the same approach as
for the wider workforce.

A number of factors are taken into
account including:

• Individual performance.
• The approach to pay throughout the

organisation.

• Company affordability and trading
environment, including return on
invested capital.

• The total remuneration pay mix for

each individual.

• The relative contribution of the job to

the overall business success.

Market pay benchmarking is considered
an additional reference point. Individual
performance is the primary determining
factor in whether to grant a pay increase.
Pay increases are not granted in the
absence of a satisfactory level of
performance. Similarly, the operational
performance of the business and its ability
to pay are naturally considered when the
quantum of any increase is considered.

Service contracts
Executive directors’ service contracts comply with terms and conditions of
employment in the local jurisdiction. Details of the date of appointment and
relevant employer notice period are set out in the following table:

Bob van Dijk

Basil Sgourdos

Mark Sorour(1)

Date of appointment

1 August 2013

1 August 1995 1 October 2002

Notice period

Six months

Three months

Note
(1) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive

director.

Our remuneration structure
We have outlined the three elements of
pay for our executive directors below,
and the approach is similar for the chief
executive’s direct reports. The same
principles are applied to employees
across the group, where appropriate.

Fixed pay
Base salary/TCTC
• Base salary is the fixed pay that an
employee receives and reflects the
performance and contribution of the
individual and market value of the
role. The cost of employee benefits
and employers’ taxes is in addition.
People are employed in South Africa
on a TCTC basis, and the cost of
benefits and employers’ tax is
included in this figure.

• Salary is paid monthly in cash.
• Benefits provided include a mix of

cash and non-cash benefits, including
pension, medical and other optional
benefits.

• Fixed pay is reviewed annually and any
increases are typically effective from
1 April each year.

• A number of factors are taken into
account during the review process
including personal performance, the
scope and nature of the role, relevant
companies in the technology sector
and local economic indicators such as
inflation, cost-of-living changes and the
relevant labour market, to ensure
remuneration is fair, sensible and
market competitive.

Variable pay
Annual performance-related
incentive
• Participants are eligible to receive

awards under the discretionary annual
performance-related incentive
scheme to incentivise and recognise
the achievement of group financial
and operational objectives and
personal performance.

• The purpose of the annual incentive
plan is to ensure executive alignment
with and focus on the annual

board-approved business plan. The
achievement of these annual plans
will cumulatively drive long-term
shareholder value.

• The performance measures for each

executive director are tailored to their
roles and responsibilities. Further
information is provided in the
implementation report each year.
• For the group chief executive and

group CFO, at least 50% of maximum
bonus opportunity is based on financial
measures, including and excluding
Tencent (in the case of the CEO).
• For the group CIO (retired 31 March

2018), given the nature of this
deal-based role, more emphasis was
placed on the operational and strategic
objectives and hence a smaller
weighting (30%) was based on group
financial performance.

• The annual bonus opportunity for each
executive is agreed annually in advance
of the financial year, and any payout is
based on targets that are verifiable and
aligned to the business plan, risk
management policy and strategy. The
target and maximum annual bonus
opportunity levels are the same for the
executive directors (ie there is no
possibility to over-perform against the
target) and are set at:
– group chief executive: 100% of base

salary

– group CFO: 50% of total cost to

company (plus an additional variable
bonus capped at 25% of total cost to
company relating to obtaining new
general funding, in financial years
where such funding is obtained). In
FY19, the maximum for the CFO has
been moved to 100%, in line with
market benchmarks, in addition, as
with FY18, a variable bonus capped
at 25% of total cost to company
relating to obtaining new general
funding applies, and

– group CIO: 200% of total cost to

company.

• Any payouts are made wholly in cash.
• Further information on the targets and
payouts are provided each year in the
implementation report.

The committee may apply judgement
and shall have discretion to make
appropriate adjustments to an
individual’s annual bonus to ensure it
reflects the underlying financial
performance of the group.

Target setting: When determining
the targets used for our annual
performance incentive plan, we take into
account a number of reference points
including the group internal board-
approved business plan and historic
performance. The committee
undertakes a thorough assessment to
ensure that targets are sufficiently
stretched in the context of potential
remuneration delivered.

The performance of executives and
employees against their annual
performance incentive objectives (STI)
has significant influence on the decision
to award long-term incentives. Any share
options or share appreciation rights that
are awarded will only deliver value to the
participant if business performance
drives an increase in the value of the
asset.

There are therefore three personal
performance requirements
associated with a stock option
or share appreciation right:

• Strong short-term (annual)

performance leading to a decision
to grant a long-term incentive.
• Ongoing employment which

permits the incentive to vest over
four to five years.

• Superior performance over time,
leading to value creation in the
scheme and for the shareholder.

Note: Performance measures and
weightings are dealt with in more detail
in the implementation report. See pages
81 to 91.

Long-term incentives (LTIs)
• LTI awards comprise a significant

portion of total compensation and are
designed to incentivise the delivery of
sustainable long-term growth and
provide alignment with our
shareholders.

• Awards are normally granted annually
to the executive directors under two
types of LTI schemes:
– share appreciation rights (SARs), and
– share options (SOs).

• Detailed scheme rules documents
provide for the operation and
governance of each scheme.

Share options (SOs)
• Awards are made based on the share

price on the date of the grant.

• SOs deliver value based on the growth
in the share price over a specified time
period with vesting typically over a
four-year period, with 25% vesting each
year and a term of 10 years.

• Value is only delivered if there has been
an increase in the share price following
the date of grant.

• Once an award vests, participants can

then buy company shares at the
predetermined strike price and will gain
value from any increase in the price.

Share appreciation rights (SARs)
• Awards to executive directors are

typically made in the Naspers Global
Ecommerce SAR Plan, which takes into
account the performance of a number
of internet businesses, In this way any
non-performing business will balance
the value created by others, thus
ensuring any gain by the executive
directors adequately reflects total
return on invested capital. Many of the
segment chief executives who report
to the group chief executive are
similarly incentivised in schemes that
consider the sum of the value of all of
the businesses for which they are
responsible.(1)

• SARs deliver value based on the

growth in the valuation of a group of
businesses over a specified time period
with vesting typically over a four- to
five-year time period with a term of
typically 10 years.

• Any value delivered is based on the

change in total value of the business or
group of businesses. This means that
the sum of all decreases/increases in
value is calculated to determine the
final value.

• Any payouts are made in an equivalent

value of Naspers shares. Naspers
shares are bought on the open market
and shareholders are not diluted to
settle employee SAR gains.

Note that restricted stock units (RSUs)
are not available to the chief executive,
CFO, CIO or any direct reports of the
chief executive, or other senior
executives across the group. The
Naspers restricted stock programme is
specifically tailored to engineering,
specialist and technical talent. The
inclusion of RSUs in our remuneration
framework ensures that we are
attracting and retaining critical technical
and specialist talent, such as software
engineers and those with specialist skills
such as artificial intelligence, machine
learning, content rights, product design
etc, within highly competitive markets.
During FY18 the group purchased on
market 42 969 (2017: 57 445) Naspers
N ordinary shares at average market
prices ranging between R2 650.54 and
R3 728 per share in respect of grants
awarded in the Naspers RSU trust.
In total 197 132 Naspers N ordinary
shares have been purchased on market
for this purpose.

Note
(1) Some LTI schemes associated with underlying
assets in which the group has a minority
shareholding are not aggregated into the
executive director schemes, as valuation is
dependent on the occurrence of a corporate
transaction versus an annual valuation. There is
no annual participant liquidity in these schemes.
In such limited cases executive directors have
received an award directly in those schemes to
ensure that they are incentivised to deliver
appropriate returns on invested capital in those
businesses.

Outline of LTI plans in operation

Share appreciation
rights (SARs)

Share options
(SOs)

Restricted stock units
(RSUs)

A right to benefit from
any increase in value
of the business unit
over which an award
is made

A right to buy a
Naspers share at
a preagreed price

An award of Naspers
shares that is
transferred to
participants after time
restrictions have
passed

Total value of the
business

Total share
price

Value delivered
to participant
Change in value of
business unit between
grant and vest

Value delivered
to participant
Change in share price
between grant and vest

Value delivered
to participant
Full value delivered
to the participant

• Naspers shares are
delivered on vesting

• If there is no change

or a decrease in value,
there is no gain for
the participant.

• Gains are settled in
Naspers shares

or a decrease in value,
there is no gain for
the participant.
• When the option
is exercised the
participant becomes
a shareholder

Granted
to executive
directors

Granted to
the wider
employee
population

* Specifically targeted talent, to attract and retain scarce resource at a junior to mid level in their career.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018
78

Remuneration report for the
year ended 31 March 2018
continued

Executive director participation in share schemes
The table below sets out details of LTI plans in which the executive directors are currently participate. Since September 2016, awards to the chief executive and CFO have been made in the
Naspers Global Ecommerce Share Appreciation Rights Plan and the Naspers Share Option Plan only.

Type of plan

Entity

Details

Name of plan

Comments

Share options

Naspers group
N ordinary shares

4-year phased vesting,
10-year term

MIH Services FZ LLC Share
Trust(1)

Vesting schedule
amendment approved in
2017

Executive director
participating

Bob van Dijk
Basil Sgourdos

Share options

Naspers group
N ordinary shares

5-year vesting, phased vesting
in years 3, 4, 5.
10-year term

MIH Services FZ LLC Share
Trust(1)

Legacy Naspers Share
Option Plan for non-South
African residents

Bob van Dijk
Basil Sgourdos

Share options

Naspers group
N ordinary shares

4-year phased vesting,
10-year term

MIH Holdings Share Trust

Vesting schedule
amendment approved in
2017

Mark Sorour

Share options

Naspers group
N ordinary shares

5-year vesting, phased vesting
in years 3, 4, 5.
10-year term

MIH Holdings Share Trust

Legacy Naspers Share
Option Plan for South
African residents

Mark Sorour

Share appreciation rights

Naspers Ecommerce

5-year phased vesting,
10-year term

Naspers Global Ecommerce
SAR Plan

Reﬂects main internet
companies in the group

Bob van Dijk
Basil Sgourdos
Mark Sorour

Share appreciation rights

Showmax

5-year phased vesting,
10-year term

Showmax SAR Plan

Last granted in September
2015

Basil Sgourdos
Mark Sorour

Share appreciation rights

Flipkart

5-year phased vesting,
10-year term

Flipkart SAR Plan

Last granted in August 2016

Bob van Dijk
Mark Sorour

Share appreciation rights

SimilarWeb

5-year phased vesting,
10-year term

SimilarWeb SAR Plan

Last granted in September
2016

Bob van Dijk
Mark Sorour

Share appreciation rights

Takealot

5-year phased vesting,
10-year term

Takealot SAR Plan

Last granted in August 2016 Mark Sorour

Share appreciation rights

MIH China/MIH TC
(Tencent)

5-year phased vesting,
10-year term

MIH China/MIH TC 2008
SAR Plan

Last granted in
January 2014

Mark Sorour

Note
(1) The MIH Mauritius N ordinary share option scheme covering the Naspers group was redomiciled to United Arab Emirates and as a result the name was changed.

Refer to Annexure A: Details of executive director participation in share schemes.

have been made to executive directors
in such schemes since September 2016.

The chief executive, CFO and CIO
participate in the Naspers Global
Ecommerce SAR scheme which is a
sum-of-the-parts scheme consisting of
the main entities in ecommerce. The
valuation process is illustrated below
and it is indicative of the process for all
other schemes. The underlying assets
included in the scheme are valued in
accordance with their relevant rules
and the valuations and governance
processes are shown below.

Scheme limits
We place limits on how much of the
cap table is available for employee
compensation. In general, no more
than 15% of the capitalisation (cap)
table can be used for employee
compensation. Depending on the life
stage of the business, the scheme limit
can be lower.

When the business takes funding from
Naspers, the scheme gets diluted as
additional shares are issued.

Valuing long-term incentives
We operate SO and SARs plans that
are associated with businesses not
publicly listed. We must therefore
perform an annual valuation on these
assets, which ensures we maintain
ongoing alignment between value
creation for shareholders and
management and employee
remuneration outcomes.

For executives who are responsible for
a number of businesses, it is important
to incentivise them on the overall
performance of the assets for which
they are responsible, ensuring that they
are not incorrectly rewarded for
success in one part of their portfolio if
value is not being created in another.
We therefore created several ‘umbrella’
(or sum-of-the-parts) schemes
encompassing several assets in which
the most senior executives participate.
Examples include the Naspers Global
Ecommerce SAR scheme, the Naspers
Global Classifieds SAR scheme and the
Naspers Fintech SAR scheme.

Some LTI schemes associated with
underlying assets in which the group has
a minority shareholding have not been
aggregated into the umbrella schemes,
as the valuation of these schemes is
dependent on the occurrence of a
corporate transaction versus the annual
valuation as performed for the umbrella
schemes. There is also no liquidity for
participants in these schemes until the
occurrence of a liquidity event (and the
awards have vested) versus regular
liquidity in the umbrella schemes (once
the awards have vested). In such limited
cases senior executives have received
an award directly in those schemes to
ensure that they are incentivised to
deliver appropriate returns on invested
capital in those businesses. No awards

Valuations process

Underlying business
submits 10-year
business plan
and annual budget

Naspers provides
board-approved
10-year business
plan for each underlying
business to Deloitte

Deloitte,
independently from
management, values
the underlying assets
at March 31 annually
and additionally,
whenever a significant
change occurs

Deloitte issues
a report confirming
the valuation for each
of the underlying
operations

Segment schemes and the ecommerce schemes are a ‘basket of assets’ representing the
valuations of the underlying operations

Governance

Report issued
Deloitte, the
independent valuer,
issues a report with
the respective share
scheme valuations

Group auditors
PwC, the group
auditors, audit the
capitalisation tables,
using the valuations
as input

Review
The valuations
subcommittee of
the Naspers human
resources and
remuneration
committee review
the valuations before
recommending the
values for approval
to the remuneration
committee. The
subcommittee consists
of members of the
Naspers board

Submission
Reports from Deloitte,
PwC and the valuations
subcommittee are
submitted to the
Naspers human
resources and
remuneration
committee as part of
their approval process

Approval
Once the human
resources and
remuneration committee
approves the valuations
and resultant share prices,
the share prices will be
updated and participants
can exercise their share
options or share
appreciation rights at
these updated prices in
accordance with the
Naspers trading-in-
securities policy

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201880

Remuneration report for the
year ended 31 March 2018
continued

Performance management
at Naspers
Pay for performance is one of the
pillars of our reward philosophy.
Personal performance (including
the financial results of the business)
is the determining factor in whether
an individual receives a base salary
or TCTC increase, an annual
performance-related incentive
payout and/or a LTI in the form
of SOs or SARs.

Our executives are eligible to
participate in a performance-related
STI programme. This is an annual
programme in which participants may
receive annual performance-related
incentive payments if they achieve
certain preapproved business and
personal goals. Similarly, mostly annual,
STI programmes are operated across
the group.

Performance goals are directly aligned
with the approved business plans. In
the case of the chief executive, his
annual performance-related incentive
goals are exactly as per the Naspers
board-approved annual business plan.
The annual goals of functional and
business segment leaders reporting to
the chief executive will similarly be
based on financial and personal
objectives, tailored to their specific
areas of responsibility and impact.

Personal goals are arrived at as an
outcome of the annual business
planning process. As budgets and
operating plans are designed prior to
the end of the financial year, so too
are the personal performance goals
at an individual level. These goals, if
achieved, drive the accomplishment
of the financial and operating plan of
the business and how it is delivered.

Managers engage in continuous
conversations with their people
throughout the financial year to
ensure that their plans are on track.
At the end of the financial year both
the overall performance of the
business, and the individual’s
achievement of their personal
goals are considered and this
may translate into the payment of an
annual performance-related incentive.
While we do not force-rank
performance scores, we do expect
that any performance-related
incentive payments reflect the overall
performance of the business where
appropriate. Individuals who have
performed well against their
performance-related incentive goals,
are eligible to be considered for a
LTI grant and a pay increase. Only
strong performers are considered
for LTI awards.

Non-executive directors’
remuneration policy
The fee structure for non-executive
directors has been designed to ensure
we attract, retain and appropriately
compensate a diverse and internationally
experienced board of non-executive
directors, given the highly competitive
markets in which we operate in, and
the global competition we face.

Non-executive directors receive an
annual fee as opposed to a fee per
meeting, which recognises their ongoing
responsibility for effective control of
the company. They may also receive
an additional fee for group board
committees and subsidiary boards,
to reflect the additional responsibilities
and associated time commitment.
Remuneration is reviewed annually,
and is not linked to the company’s share
price or performance. Non-executive
directors do not qualify for share
allocations under the group’s incentive
schemes.

The remuneration of non-executive
directors is determined following a
benchmarking exercise which considers
not only JSE-listed companies, but, given
the relative size, scale and complexity
of the group’s activities, also considers
international comparators in the media,
video-entertainment and consumer
internet sectors.

Non-executive directors’ terms
of appointment
The board has clear procedures for
appointing and orientating directors.
The nomination committee periodically
assesses the skills represented on the
board and determines whether these
meet the company’s needs. Annual
self-evaluations are done by the board
and its committees. Directors are
invited to give their input in identifying
potential candidates. Members of the
nomination committee propose
suitable candidates for consideration by
the board. A fit-and-proper evaluation
is performed for each candidate.

Retirement and re-election
of directors
All non-executive directors are subject
to retirement and re-election by
shareholders every three years.
Additionally, non-executive directors
are subject to election by shareholders
at the first suitable opportunity for
interim appointments. The names of
non-executive directors submitted for
election or re-election are accompanied
by brief biographical details to enable
shareholders to make an informed
decision on their election. The
reappointment of non-executive
directors is not automatic.

For the full remuneration policy, go to
www.naspers.com.

3. Implementation of remuneration policy
In this section we outline how our remuneration policy for executive directors has been implemented during this financial year
and how we intend to operate it during the next financial year. All decisions in relation to executive remuneration have been
made in line with our remuneration policy for this financial year.

Executive directors’ total remuneration for the financial year to 31 March 2018

Below we show the relative weightings of each type of compensation: Base salary/
TCTC, STI and LTIs for each executive as at 31 March 2018.

BOB VAN DIJK

BASIL SGOURDOS

Bob van Dijk

Basil Sgourdos

Mark Sorour(4)

Guaranteed
fixed pay
(US$’000)(1)

Actual annual
bonus
(US$’000)(2)

Total
(US$’000)

Fair value LTI
awarded
(US$’000)(3)

2018

2017

2018

2017

2018

2017

1 332

1 104

862

828

719

682

1 064

973

605

443

1 904

1 718

2 396

2 077

1 467

1 271

2 623

2 400

9 636

10 403

1 954

1 752

778

958

Notes
(1) Guaranteed fixed pay for 2018 comprises base salary levels of US$1 332 000 for Bob van Dijk with the remainder attributing to pension and other benefits,

eg medical insurance. For Basil Sgourdos and Mark Sorour this comprises total TCTC of US$970 000 and US$952 000 respectively, which incorporates base salary
and any benefits.

(2) Annual bonus levels paid out in respect of each financial year.
(3) The fair value of LTIs awarded during each financial year. Details of the separate awards can be found in the shareholding table on page 83.
(4) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director and remains on the Mail.ru Group board. To provide

management with the option of obtaining his advice on critical transactions, a consultancy contract was concluded with Mark.

ANNUAL FIXED PAY

ANNUAL STI (TARGET)

ANNUAL FAIR-VALUE LTI

MARK SOROUR

11.07

8.84

80.08

ANNUAL FIXED PAY

ANNUAL STI (TARGET)

ANNUAL FAIR-VALUE LTI

25.19

17.68

57.11

ANNUAL FIXED PAY

ANNUAL STI (TARGET)

ANNUAL FAIR-VALUE LTI

21.14

55.98

22.87

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018

Remuneration report for the
year ended 31 March 2018
continued

Guaranteed fixed pay (TCTC)
During the year, levels of base salary and
TCTC (where relevant) continued to
vary across the jurisdictions where we
operate. In determining any increases
for executive directors we considered
personal performance, business
performance and local economic
indicators, overall movement in the
local (and, where appropriate, regional
and global) labour market, and levels
observed across the wider workforce.
During the year, group companies made
contributions for executive directors to
the appropriate pension schemes.
These contributions are in line with
market norms and constitute a modest
proportion of the individuals’ total
remuneration.

Annual incentive payout in respect
of the 2017/18 financial year
During the financial year, the bonus
awards were subject to a combination
of financial, operational and strategic
performance measures. The target and
maximum achievement levels are one
and the same (ie there is no
opportunity to overachieve on bonus
payout) and were:

Bob van Dijk: 100% of base salary

Basil Sgourdos: 50% of TCTC (plus
an additional variable bonus capped
at 25% of TCTC relating to obtaining
new general funding, in financial years
where such funding is obtained)

Mark Sorour: 200% of TCTC

The weightings of each performance
measure varied for each executive
director, subject to their key priorities
during the year.

Free cash
outﬂow

Core headline
earnings

Core headline
earnings
(excluding
Tencent)

Annual performance incentive: Achievement against financial goals
In the following tables we outline the actual outcomes for each financial performance measure relative to the target set at the
beginning of the financial year, together with the resulting payout.

Bonus target

Bonus achieved

Bob van
Dijk

Basil
Sgourdos

Mark
Sorour

Bob
van Dijk

Basil
Sgourdos

Mark
Sorour

Financial
measure

Actual

Bonus
impact

% of base
salary

% TCTC

% of base
salary

Revenue

US$20.1bn

Achieved

–

% TCTC

–

US$242m

Achieved

US$2 507m Achieved

(US$781m) Achieved

–

In addition to the above, each executive director was also subject to strategic and operational performance measures.

Strategic and operational
performance measures for Bob van
Dijk (chief executive) accounted for
50% of his total bonus opportunity.
These related to classifieds, payments,
food delivery, travel, B2C ecommerce
and video entertainment. Financial
measurements included topline growth
(eg gross merchandise volume (GMV)),
revenue growth, trading profit growth
(or trading loss reduction). Operational
measurements included growth in the
number of customers, relative
competitive position and new product
and/or new market development.

Strategic and operational
performance measures for
Basil Sgourdos (CFO) accounted
for 50% of his total bonus opportunity
and related to the management of the
finance function, with an emphasis
on tax, treasury, investor relations,
governance and control, and
finance talent.

Mark Sorour – annual performance
incentive: The short-term incentive
for Mark Sorour was based on group
financial goals (as per those for the chief
executive and CFO) with a weighting of
30%. 70% of the short-term incentive
for the chief investment officer relates
to M&A deals. The nature of these
goals is naturally confidential but the
typical incentives relate to the price
and mechanics of the deal.

Outcomes: The outcomes above
resulted in annual bonus payout levels
of 80% base salary for Bob van Dijk
and 62% and 200% of TCTC for Basil
Sgourdos and Mark Sorour respectively.

Long-term incentives costs
As a committee, we have endeavoured
to be more transparent on the
disclosure of the awards made, and
those outstanding under our long-term
incentive scheme.

Share-based compensation incentives
across the group account for 8.7% of
total staff costs, and 1.8% of overall
group costs, for example the cost of
providing services and sale of goods;
selling, general and administration
expenses. Further details can be
found on pages 140 to 151 of the
full annual financial statements on
www.naspers.com.

Given the nature of our businesses,
we operate a number of incentive plans
for our executive directors to ensure
they are incentivised across the whole
portfolio. A full statement of the
holdings of the executive directors
can be found on pages 88, 90 and 91.

Plan participation
Schemes in which executive directors were awarded LTIs in FY18:

SARs

Active LTI
plans

Naspers
Global
Ecommerce

Entity

Details

Award made to

Naspers

5-year annual
phased vesting

Bob van Dijk
Basil Sgourdos
Mark Sorour

SOs

Naspers
N ordinary
shares

Valuation based
on the underlying
assets

4-year phased
vesting

Bob van Dijk
Basil Sgourdos
Mark Sorour

Details of the group’s share-based incentive schemes are disclosed in note 43 on
pages 140 to 142 of the annual financial statements on www.naspers.com.

Value of historical long-term incentive grants to executive directors
Due to the pace of change in our industry and the evolution of key priorities each year, the award levels for each executive director vary from year
to year. To reflect this, we have provided a summary below of the awards made to each executive director over the past three years.

Bob van Dijk
(US$’000)

Basil Sgourdos
(US$’000)

Mark Sorour
(US$’000)

Face value(1)

Fair value(1)

Face value(1)

Fair value(1)

Face value(1)

Fair value(1)

0
(0% Naspers shares,
0% SARs)

2 053
(51% Naspers
shares, 49% SARs)

848

3 074
(51% Naspers
shares, 49% SARs)

1 308

21 630
(100% Naspers
shares)

10 403

4 970
(33% Naspers
shares, 67% SARs)

1 752

2 473
(53% Naspers
shares, 47% SARs)

958

36 290
(32% Naspers
shares, 68% SARs)

9 636

7 634
(17% Naspers
shares, 83% SARs)

1 954

2 494
(100% Naspers
shares)

778

FY16

FY17

FY18

Note
(1) Grant date face value/fair value for awards.

As per King IV™ guidelines, we set out the fair value for all awards made in the year and all of those awards that are outstanding.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201884

Remuneration report for the
year ended 31 March 2018
continued

Awards released during the period
1 April 2017 to 31 March 2018
During the year a number of share
options and share appreciation rights
were released (vested) to executive
directors and these are outlined in
the adjacent table.

Naspers N options

Share appreciation rights

Number of
options

Release value
at release date
(R)

Face value at
grant date (R)

Fair value at
grant date (R)

Scheme name

Number
of share
appreciation
rights

Release value

Face value

Fair value

Bob van Dijk

277 333

813 120 943

319 735 321

151 090 876

Flipkart SAR Plan

73 170 US$4 656 539 US$4 656 539 US$1 685 025

6 698

17 314 330

5 143 348

2 126 188

SimilarWeb SAR Plan

39 937

US$225 644

US$57 909

US$19 188

Naspers Global Ecommerce SAR Plan

1 493 226 US$41 287 699 US$23 264 461 US$7 312 840

Basil Sgourdos

11 124

28 940 310

4 835 861

1 869 837 Naspers Global Ecommerce SAR Plan

9 682

US$267 707

US$179 988

US$53 810

7 469

9 120

21 625 593

10 297 310

4 441 337 Naspers Global Ecommerce SAR Plan

32 599

US$896 798

US$666 650

US$170 017

23 575 200

7 003 186

2 895 019

Showmax SAR Plan

1 111

US$19 998

US$9 621

Mark Sorour(1)

10 000

29 319 300

11 528 933

5 280 064 MIH China/MIH TC 2008 SAR Plan

8 000 US$1 447 280

US$343 590

US$89 413

9 337

27 034 163

12 872 672

5 307 703

Flipkart SAR Plan

13 680

35 362 800

10 504 780

4 203 648

Flipkart SAR Plan

18 539

48 231 248

8 059 335

3 206 296

Flipkart SAR Plan

13 680

35 362 800

10 504 780

4 203 648

SimilarWeb SAR Plan

18 539

48 231 248

8 059 335

3 206 296

SimilarWeb SAR Plan

617

942

841

344

1 497

1 336

US$39 266

US$14 209

US$59 949

US$20 704

US$53 521

US$12 834

US$1 944

US$499

US$165

US$8 458

US$10 000

US$3 927

US$7 548

US$8 924

US$4 301

Naspers Global Ecommerce SAR Plan

13 493

US$373 081

US$210 221

US$66 080

Naspers Global Ecommerce SAR Plan

8 606

US$237 956

US$159 985

US$47 830

Naspers Global Ecommerce SAR Plan

6 985

US$192 157

US$142 843

US$36 430

Takealot SAR Plan

Showmax SAR Plan

1 094

925

R97 847

R121 478

R52 179

R82 732

R121 129

R38 779

2 222

US$39 996

US$19 242

Note
(1) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director.

Awards made during the period 1 April 2017 to 31 March 2018

Naspers N share options

Share appreciation rights

Number of
options

Face value(1)
(R)

Fair value
(R)

Scheme name

Number
of share
appreciation
rights

Face value
(US$)

Fair value
(US$)

51 728

148 031 569

44 959 480 Naspers Global

733 945

20 000 001

4 980 814

Ecommerce SAR Plan

Naspers Global
Ecommerce SAR Plan

175 259

4 837 148

1 176 485

5 776

16 529 352

5 020 220 Naspers Global

126 766

3 454 374

860 281

Ecommerce SAR Plan

Naspers Global
Ecommerce SAR Plan

105 088

2 900 429

705 439

11 049

32 549 139

10 151 905

Bob van
Dijk

Basil
Sgourdos

Mark
Sorour(2)

Notes
(1) Grant date face/fair value for awards.
(2) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director.

Executive directors’ relative shareholding by scheme (fair value)
Value of unvested equity grants by scheme after FY18 grant

BOB VAN DIJK
Unvested equity mix after FY18 grant
(fair value)

BASIL SGOURDOS
Unvested equity mix after FY18 grant
(fair value)

FLIPKART SAR PLAN

MIH SERVICES FZ LLC
(Naspers shares)
NASPERS GLOBAL ECOMMERCE

SAR PLAN

SIMILARWEB SAR PLAN

MIH SERVICES FZ LLC
(Naspers shares)
NASPERS GLOBAL ECOMMERCE

SAR PLAN

SHOWMAX SAR PLAN

0.1

MARK SOROUR
Unvested equity mix after FY18 grant
(fair value)

Mark Sorour has not received a grant
in the underlying schemes since
August 2017.

FLIPKART SAR PLAN

MIH CHINA/MIH TC 2008 SAR PLAN

MIH HOLDINGS SHARE TRUST
(Naspers shares)
NASPERS GLOBAL ECOMMERCE
SAR PLAN

SHOWMAX SAR PLAN

SIMILARWEB SAR PLAN

TAKEALOT SAR PLAN

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018

Remuneration report for the
year ended 31 March 2018
continued

Gains made on any options or SARs exercised during the period 1 April 2017 to 31 March 2018

Naspers – N share options

Date
exercised

Number
of options

Strike price

Exercise price

Gross gain

Share appreciation rights

Date
exercised

Scheme

Bob van Dijk

Basil Sgourdos

–

Mark Sorour

03/07/2017

13 680

R770.00

R2 600.00 to R2 601.61

R35 575 136

Note
(1) Mr Sorour exercised share appreciation rights in
a group share-based incentive plan and received
5 833 Naspers N ordinary shares in settlement
of the gain. He then sold 5 833 Naspers N
ordinary shares.

Strike price

Exercise price

–

19/07/20171

5 833

R2 768.27 to R2 775.01

R16 178 111

19/07/2017(1)

MIH China/MIH TC 2008 SAR Plan

US$42.95

US$116.29

40 588 541 Naspers N ordinary shares
(some 10% of Naspers’s N ordinary
share capital at 31 March 2010) may be
issued for the group’s share-based
incentive schemes. During the financial
year to 31 March 2018, 390 806 new
N ordinary shares had been so issued,
resulting in a total of 30.10% of the
approved 40 588 541 Naspers N
ordinary share capital being used
to date.

Non-executive directors’ fees
The committee is informed by the
external market when reviewing the
fee structure and levels for our
non-executive directors. This includes
market fee levels for Naspers’s industry
peers internationally, such as
competitors in the same industry and
of similar scale and those fee levels
observed in the Top 10 JSE companies.

The current non-executive director fee
structure and levels, which reflect a 5%
year-on-year increase, were approved
by shareholders at the annual general
meeting in August 2017.

Dilutive impact of group
share-based incentive schemes

From 1 April 2018, the
group will purchase
Naspers shares on the
JSE for the purpose of
issuing new Naspers share
options to employees and
settling gains made on all
share-based incentive
schemes.

The group’s share-based incentive
schemes are set out in equity
compensation benefits in the notes
to the annual financial statements on
www.naspers.com. At 31 March
2018 the group held 3 097 876
(2017: 3 293 211) Naspers N ordinary
shares as treasury shares to settle
outstanding options under certain
group share incentive schemes.

The expected dilutive effect of these
treasury shares on the group’s earnings,
on a per-share basis, was 8 US cents
per N ordinary share (2017: 2 US cent).
In accordance with schedule 14 of the
JSE Listings Requirements and the
South African Companies Act, at the
annual general meeting in August 2011
shareholders approved that up to

Board

Chair

Member

Daily fees when travelling to and attending meetings outside
home country

Committees

Audit committee

Risk committee

31 March 2018

31 March 2019

US$452 000

US$474 600

US$180 800

US$189 840

US$3 500

Chair

US$111 350

US$116 925

Member

US$44 540

US$46 770

Chair

US$66 150

US$69 450

Member

US$26 460

US$27 780

Human resources and remuneration committee

Chair

US$78 250

US$82 163

Nomination committee

Chair

US$42 175

US$44 275

Social and ethics committee

Chair

US$57 875

US$60 775

Member

US$16 870

US$17 710

Member

US$31 300

US$32 865

Member

US$23 150

US$24 310

Other

Trustee of group share schemes/other personal funds

R48 720

R51 200

Non-executive directors’ fees continued
The non-executive chair does not receive additional remuneration for attending meetings, or being a member of or chairing any committee of the board, or attending Tencent board and committee meetings.

Non-executive
directors

J P Bekker

E M Choi

H J du Toit

C L Enenstein

D G Eriksson

R C C Jafta

F L N Letele

G Liu

D Meyer

R Oliveira
de Lima

S J Z Pacak

T M F Phaswana

J D T Stofberg

B J van der Ross

2018

2017

Directors’ fees(1)

Committee(2) and trustee(3) fees

Other fees(4)

Directors’ fees(1)

Committee(2) and trustee(3) fees

Other fees(4)

Paid by
company
US$’000

Paid by
subsidiary
US$’000

Paid by
company
US$’000

Paid by
subsidiary
US$’000

Paid by
company
US$’000

Paid by
subsidiary
US$’000

Total
2018
US$’000

Paid by
company
US$’000

Paid by
subsidiary
US$’000

Paid by
company
US$’000

Paid by
subsidiary
US$’000

Paid by
company
US$’000

Paid by
subsidiary
US$’000

526

258

–

258

233

258

233

261

251

233

251

230

–

235

199

–

433

–

549

286

–

318

573

512

689

258

292

316

376

281

251

301

504

–

246

218

232

218

232

246

242

221

218

–

580

5 002

3 013

179

–

224

180

–

587

–

275

–

187

–

Total

3 458

204

668

562

4 429

Total
2017
US$’000

524

–

296

525

485

515

232

272

282

503

288

221

286

Notes
(1) Koos Bekker elected to donate the full after-tax
proceeds of his Naspers director’s fees, being
R3.4m, to Simondium Primary, a school serving
mostly farmworkers’ children in the Drakenstein
Valley of South Africa.
(2) Appointed 21 April 2017.
(3) Hendrik du Toit elected not to receive director’s

fees.

(4) Compensation for assignments.

General notes
Directors’ fees include fees for services as directors, where appropriate, of
Media24 Proprietary Limited, MultiChoice South Africa Holdings Proprietary
Limited and NMS Insurance Services Limited. An additional fee may be paid
to directors for work done as directors with specific expertise.

Committee fees include fees for attending meetings of the audit committee,
risk committee, human resources and remuneration committee, nominations
committee and social and ethics committee. Committee and trustee fees include,
where appropriate, fees to be considered by shareholders at the annual general
meeting on 24 August 2018 for services as trustees of the group share-based
schemes. Non-executive directors are subject to regulations on appointment
and rotation in terms of the company’s memorandum of incorporation and the
South African Companies Act.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201888

Remuneration report for the
year ended 31 March 2018
continued

The committee conducts an annual
benchmarking exercise to ascertain
whether the fees for non-executive
directors are competitive, fair and
reasonable. Fees are not only
benchmarked against JSE-listed
companies but also against international
publicly listed companies operating in
the consumer internet sector. Given
the global scale and complexity of the
businesses which the group operates
and has interest in, it is important that
we can attract and retain the best
globally orientated board members.

Non-executive directors do not receive
any long-term or equity-based
compensation.

Termination payments
No termination payments were made
to executive and non-executive
directors on termination of
employment or office in FY18.

Compliance
There were no deviations from the
remuneration policy in FY18.

Directors’ interest in Naspers shares
The directors of Naspers have the following interests in Naspers A ordinary shares on 31 March:

31 March 2018

31 March 2017

Naspers A ordinary shares

Name

J D T Stofberg

Beneficial

Direct

Indirect

–

166

Beneficial

Total

166

Direct

Indirect

–

166

Total

166

The directors of Naspers (and their associates) had the following interests in Naspers N ordinary shares as at 31 March:

31 March 2018

31 March 2017

Naspers N ordinary shares

Beneficial

Direct

Indirect

Total

Direct

Indirect

Total

4 688 691

–

1 474

737

–

4 688 691

–

737

–

Name

J P Bekker

E M Choi(1)

H J du Toit

C L Enenstein

D G Eriksson

R C C Jafta

F L N Letele(2)

G Liu

D Meyer

R Oliveira de Lima

S J Z Pacak(3),(4),(8)

T M F Phaswana

V Sgourdos(8)

–

1 474

–

376 635

291 548

668 183

312 635

537 548

850 183

3 530

86 990

61 556

3 530

86 990

62 775

–

1 262

3 530

59 277

23 680

3 530

59 277

24 942

M R Sorour(5),(6),(8)

1 219

J D T Stofberg

159 831

291 888

451 719

159 831

291 888

451 719

B J van der Ross(7)

1 650

820

2 470

–

568 062

–

400

284 031

540 809

5 993 085

6 533 894

474 465

5 889 045

6 363 510

B van Dijk(8)

Total

General note
Koos Bekker and Cobus Stofberg each have an indirect 25% interest in
Wheatfields 221 Proprietary Limited, which controls 168 605 Naspers Beleggings
(RF) Beperk ordinary shares, 16 860 500 Keeromstraat 30 Beleggings (RF)
Beperk ordinary shares and 169 865 Naspers A shares. No other director of
Naspers had any direct interest in Naspers A ordinary shares at 31 March 2018
or 31 March 2017.

Notes
(1) Appointed 21 April 2017.
(2) On 8 February 2018 Nolo Letele purchased 737 Naspers N ordinary shares
upon payment of the amount of R100 794.54 to the MIH Holdings Share
Trust.

(3) On 10 July 2017 Steve Pacak’s family trust sold 15 000 Naspers N ordinary

shares at average market prices ranging between R2 523.00 and R2 529.37
per share. On 7 February 2018 Steve’s family trust sold 185 000 Naspers N
ordinary shares at average market prices ranging between R3 012.86 and
R3 077.24 per share in the MIH Services FZ LLC Share Trust. On 7 February
2018, 300 000 Naspers N ordinary shares were delivered to Steve’s family
trust upon payment of the amount of R41 028 950.84 to MIH Services FZ
LLC Share Trust from the proceeds of the sale of the 185 000 Naspers N
ordinary shares. On 7 September 2017, 18 000 N ordinary shares held in the
MIH Services FZ LLC Share Trust vested.

(4) The comparative has been restated to correct the allocation between direct
and indirect holding. The total number of shares held, remains unchanged.
(5) On 13 March 2018 Mark Sorour’s spouse sold 43 Naspers N ordinary shares

at a market price of R3 566.00 per share.

(6) Retired as an executive director on 31 March 2018. Mark remained on the

board as a non-executive director.

(7) On 15 December 2017 Ben van der Ross’s family trust purchased 420
Naspers N ordinary shares at a market price of R3 395.00 per share.
On 16 January 2018 Ben purchased 1 650 Naspers N ordinary shares
at average market prices ranging between R3 653.76 and R3 679.19
per share.

(8) Naspers share options that have been released (vested), but have not yet

been exercised, are included in the indirect column:

Number of released/
vested options
FY18

Number of released/
vested options
FY17

254 000

86 990

568 062

236 000

59 277

284 031

S J Z Pacak

V Sgourdos

B van Dijk

There have been no further changes to the directors’ interests
between the end of the financial year and 22 June 2018.

Implementation of policy in the 2018/19 financial year
We have provided details below on the proposed operation of our policy for
2018/19 financial year.

Base salary
The table below presents the base salary levels implemented for FY19.

Base salary
1 April 2018
US$’000

Base salary
1 April 2019
US$’000

1 332

970

1 385

1 009

% change

Bob van Dijk

Basil Sgourdos(1)

Note
(1)

Includes pension and other benefits.

Short-term incentives: Strategic
and operational goals
Strategic and operational goals
account for 50% of the short-term,
performance-related incentive for
the chief executive and the CFO.

For Bob van Dijk (chief executive) these
goals relate to the performance of the
business segments including Classifieds,
Payments, B2C Ecommerce, Food
Delivery and Video Entertainment.
Measurements include financial metrics
such as revenue growth and trading
profit (or trading loss reduction in
earlier-stage businesses). Other
performance metrics related to the
business segments include new product,
technology or market development,
the relative competitive position of
the business and key customer metrics
such as growth in customer numbers.

For Basil Sgourdos, these goals relate
to the effective management of the group’s
finance function including goals related
to tax, treasury, stakeholder management
and governance and controls.

Short-term incentives
Awards will be made in line with our
revised remuneration policy.

Clawback: From FY19, short-term
incentive plans for Bob van Dijk,
Basil Sgourdos and all other executive
direct reports of Bob van Dijk will
include a clawback provision.

The clawback provision will operate
for two years following the payment
of an STI or LTI and will give the
remuneration committee the ability to
claw back all or part of the incentive
paid in a particular financial year in the
event of material financial misstatement
or gross misconduct on the part of
the individual.

We have provided information on the
performance measures to be used for
the 2018/19 financial year.

Short-term incentives: Financial goals
Group financial goals account for 50%
of the short-term, performance-related
incentive of the chief executive and
CFO. The group financial goals for
Basil Sgourdos have been adjusted
compared to FY18 so that core headline
earnings including and excluding
Tencent are considered.

Measurements for both individuals
include core headline earnings including
Tencent, core headline earnings
excluding Tencent, and free cash flow.
In addition, the chief executive is
measured on revenue growth for
the group.

FY19 short-term incentive (STI)
scheme structure

BOB VAN DIJK

Maximum STI opportunity:
100% base salary

FINANCIAL GOALS:

REVENUE

CORE HEADLINE EARNINGS
(INCLUDING TENCENT)

CORE HEADLINE EARNINGS
(EXCLUDING TENCENT)

FREE CASH FLOW

STRATEGIC GOALS:

OPERATIONAL/STRATEGIC

BASIL SGOURDOS

Maximum STI opportunity:
100% base salary(1)

FINANCIAL GOALS:

CORE HEADLINE EARNINGS
(INCLUDING TENCENT)

CORE HEADLINE EARNINGS
(EXCLUDING TENCENT)

FREE CASH FLOW

STRATEGIC GOALS:

OPERATIONAL/STRATEGIC

12.5

Note
(1) An additional variable bonus capped at 25% of
TCTC relating to obtaining new general funding,
applies.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018

Remuneration report for the
year ended 31 March 2018
continued

Long-term incentives
We have set out below information on the long-term awards to be made during the 2018/19 financial year.

Annexure A
A summary of executive directors’ participation in Naspers scheme shares, in relation to shares outstanding
(not yet released/vested) at 31 March 2018, is set out below.

Naspers N share options

Naspers Global Ecommerce
Share Appreciation Rights

MIH Services FZ LLC Share Trust (Naspers share options)

Name

Number
of options

Face value
(R)

Fair value
(R)

Number
of share
appreciation
rights

Face value
(US$)

Fair value
(US$)

Bob van Dijk

61 142 196 082 394

70 034 630

418 434 14 046 829

4 855 147

Basil Sgourdos

33 108 106 177 356

37 923 010

214 759

7 209 460

2 491 881

Post this allocation and as at 31 March 2019 the fair value of Bob van Dijk’s and Basil Sgourdos’s
share-based incentives will be balanced approximately as follows:

BASED ON THE PERFORMANCE
OF THE ECOMMERCE SEGMENT
SPECIFICALLY

BASED ON THE PERFORMANCE
OF NASPERS AS A WHOLE

Clawback provision on LTI
From FY19, a clawback provision will be in operation on any LTI grants made to the executive
directors and the other direct reports of the chief executive. The provision will be in operation for
two years after the award has been made.

Naspers shareholding requirement
From FY19, the chief executive will be required to hold Naspers shares to the value of 10 times his
annual salary. The human resources and remuneration committee confirms that the chief executive
has met the required shareholding threshold for FY19.

Name

Offer date

Number of
N ordinary
shares

Face value
per share (R)

Release period

Fair value
per share (R)(1)

Bob van Dijk

11/07/2013

6 698

767.89

11/07/2018

28/03/2014

277 334

1 152.89

28/03/2019

344.19

581.04

05/07/2016

147 906

2 162.89

05/07/2019 to 05/07/2021

841.96 – 1 040.60

08/09/2017

51 728

2 861.73

08/09/2018 to 08/09/2021

638.05 – 1 083.79

Basil Sgourdos

11/07/2013

9 120

767.89

11/07/2018

344.19

04/09/2014

14 940

1 378.67

04/09/2018 to 04/09/2019

648.05 – 695.10

18/9/2015

25/9/2015

29/08/2016

08/09/2017

6 741

1 378

9 691

5 776

1 740.85

18/09/2018 to 18/09/2020

765.98 – 914.29

1 700.53

25/09/2018 to 25/09/2020

748.89 – 894.66

2 429.53

29/08/2019 to 29/08/2021

909.76 – 1 135.31

2 861.73

08/09/2018 to 08/09/2021

638.05 – 1 083.79

Note
(1) The value of the option represents the fair value on grant date in accordance with IFRS.

MIH Holdings Share Trust (Naspers share options)

Name

Offer date

Number of
N ordinary
shares

Face value
per share (R)

Release period

Fair value
per share (R)(1)

Mark Sorour(2)

11/07/2013

13 680

767.89

11/07/2018

28/03/2014

10 000

1 152.89

28/03/2019

333.60

567.40

04/09/2014

18 674

1 378.67

04/09/2018 to 04/09/2019

626.11 – 676.96

18/09/2015

10 111

1 740.85

18/09/2018 to 18/09/2020

765.98 – 914.29

25/09/2015

29/08/2016

2 067

7 787

1 700.53

25/09/2018 to 25/09/2020

748.89 – 894.66

2 429.53

29/08/2019 to 29/08/2021

909.76 – 1 135.31

28/08/2017

11 049

2 945.89

28/08/2018 to 28/08/2021

673.40 – 1 144.64

Notes
(1) The value of the option represents the fair value on grant date in accordance with IFRS.
(2) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018
91

Remuneration report for the
year ended 31 March 2018
continued

Directors’ interests in other group
share-based incentive schemes
A summary of executive directors’
participation in other Naspers group
share-based incentive schemes in
relation to shares/appreciation rights
not yet released at 31 March 2018,
is set out in the adjacent table. Full
details can be found in note 43
on pages 140 to 151 of the consolidated
annual financial statements at
www.naspers.com.

Notes
(1) The value of the SARs represents the fair value

on grant date in accordance with IFRS in respect
of scheme currency.

(2) Retired as an executive director on
31 March 2018. Mark remained on
the board as a non-executive director.

Name

Incentive scheme

Offer date

Number of SARs

Purchase price per SARs

Release period

Fair value per SARs(1)

Bob van Dijk

Flipkart SAR

10/09/2014

146 344

US$63.64

10/09/2018 to 10/09/2019

US$24.63 – US$26.04

Naspers Global Ecommerce SAR

12/09/2014

2 986 455

US$15.58

12/09/2018 to 12/09/2019

US$5.26 – US$5.59

Naspers Global Ecommerce SAR

15/08/2017

733 945

Naspers Global Ecommerce SAR

08/09/2017

175 259

SimilarWeb SAR

10/09/2014

79 874

Basil Sgourdos

Naspers Global Ecommerce SAR

17/09/2015

29 049

Naspers Global Ecommerce SAR

29/08/2016

130 400

Naspers Global Ecommerce SAR

15/08/2017

126 766

Naspers Global Ecommerce SAR

08/09/2017

105 088

Showmax SAR Plan

Mark Sorour(2)

Flipkart SAR Plan

18/09/2015

10/09/2014

11/09/2015

30/08/2016

3 334

1 235

2 830

3 368

Naspers Global Ecommerce SAR

12/09/2014

26 987

Naspers Global Ecommerce SAR

17/09/2015

25 822

Naspers Global Ecommerce SAR

29/08/2016

27 943

MIH China/MIH TC 2008 SAR

17/01/2014

8 000

SimilarWeb SAR

Showmax SAR

Takealot SAR

10/09/2014

692

17/09/2015

02/09/2016

18/09/2015

11/09/2015

30/08/2016

4 491

5 348

6 667

3 282

3 704

US$27.25

US$27.60

US$1.45

US$18.59

US$20.45

US$27.25

US$27.60

US$18

US$63.64

US$15.58

US$18.59

US$20.45

US$42.95

US$1.45

US$6.68

US$18

R111.04

R130.95

15/08/2018 to 15/08/2022

US$5.52 – US$7.91

08/09/2018 to 08/09/2022

US$5.51 – US$7.80

10/09/2018 to 10/09/2019

US$0.52 – US$0.55

17/09/2018 to 17/09/2020

US$6.04 – US$6.84

29/08/2018 to 29/08/2021

US$5.78 – US$7.07

15/08/2018 to 15/08/2022

US$5.52 – US$7.91

08/09/2018 to 08/09/2022

US$5.51 – US$7.80

18/09/2018 to 18/09/2020

US$9.30 – US$10.28

10/09/2018 to 10/09/2019

US$24.63 – US$26.04

11/09/2018 to 11/09/2020

US$23.80 – US$26.75

30/08/2018 to 30/08/2021

US$17.01 – US$20.90

12/09/2018 to 12/09/2019

US$5.26 – US$5.59

17/09/2018 to 17/09/2020

US$6.04 – US$6.84

29/08/2018 to 29/08/2021

US$5.78 – US$7.07

17/01/2019

US$11.54

10/09/2018 to 10/09/2019

US$0.52 – US$0.55

17/09/2018 to 17/09/2020

US$2.83 – US$3.16

02/09/2018 to 02/09/2021

US$3.53 – US$4.15

18/09/2018 to 18/09/2020

US$9.30 – US$10.28

11/09/2018 to 11/09/2020

R52.77 – R61.26

30/08/2018 to 30/08/2021

R48.72 – R65.50

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201892

Summarised consolidated annual financial statements

Statement of responsibility by the board of directors
for the year ended 31 March 2018

Contents

Statement of responsibility by the board of directors

Independent auditor’s report on the summary consolidated financial statements

Segmental review

Reconciliation of consolidated trading loss to consolidated operating loss

Summarised consolidated income statement

Summarised consolidated statement of comprehensive income

Summarised consolidated statement of changes in equity

Summarised consolidated statement of financial position

Summarised consolidated statement of cash flows

Notes to the summarised consolidated financial statements

Further information

Page

110

The summarised consolidated annual financial statements of the group are the responsibility of the directors of Naspers
Limited. In discharging this responsibility they rely on the management of the group to prepare the consolidated annual
financial statements, separately available on www.naspers.com, in accordance with International Financial Reporting Standards
(IFRS) and the Companies Act No 71 of 2008. The summarised consolidated annual financial statements include amounts
based on judgements and estimates made by management. The information given is comprehensive and presented in a
responsible manner.

The directors accept responsibility for the preparation, integrity and fair presentation of the summarised consolidated annual
financial statements and are satisfied that the systems and internal financial controls implemented by management are
effective.

The directors believe that the company and group have adequate resources to continue operations as a going concern in the
foreseeable future, based on forecasts and available cash resources. The summarised consolidated annual financial statements
support the viability of the company and the group. The preparation of the financial results was supervised by the financial
director, Basil Sgourdos CA(SA).

The independent auditing firm PricewaterhouseCoopers Inc., which was given unrestricted access to all financial records and
related data, including minutes of all meetings of shareholders, the board of directors and committees of the board, has
audited the consolidated annual financial statements from which the summarised consolidated annual financial statements
were derived. The directors believe that representations made to the independent auditor during audit were valid and
appropriate. PricewaterhouseCoopers Inc.’s audit report is presented on page 93.

The summarised consolidated annual financial statements were approved by the board of directors on 22 June 2018 and
are signed on its behalf by:

Koos Bekker
Chair

Bob van Dijk
Chief executive

22 June 2018

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201893

Independent auditor’s report on the summary
consolidated financial statements

To the Shareholders of Naspers Limited

Opinion
The summary consolidated financial statements of Naspers Limited, set out on pages 94 to 107 of the integrated
annual report, which comprise the summary consolidated statement of financial position as at 31 March 2018, the summary
consolidated income statement, and summary consolidated statements of comprehensive income, changes in equity and
cash flows for the year then ended, and related notes, are derived from the audited consolidated financial statements of
Naspers Limited for the year ended 31 March 2018.

In our opinion, the accompanying summary consolidated financial statements are consistent, in all material respects, with
the audited consolidated financial statements, in accordance with the JSE Limited’s (JSE) requirements for summary financial
statements, as set out in the “Basis of presentation and accounting policies” section to the summary consolidated financial
statements, and the requirements of the Companies Act of South Africa as applicable to summary financial statements.

Directors’ Responsibility for the Summary Consolidated Financial Statements
The directors are responsible for the preparation of the summary consolidated financial statements in accordance with
the JSE’s requirements for summary financial statements, as set out in the “Basis of presentation and accounting policies”
section to the summary consolidated financial statements, and the requirements of the Companies Act of South Africa
as applicable to summary financial statements.

Auditor’s Responsibility
Our responsibility is to express an opinion on whether the summary consolidated financial statements are consistent, in
all material aspects, with the audited consolidated financial statements based on our procedures, which were conducted
in accordance with International Standard on Auditing (ISA) 810 (Revised), Engagements to Report on Summary
Financial Statements.

Summary Consolidated Financial Statements
The summary consolidated financial statements do not contain all the disclosures required by International Financial
Reporting Standards and the requirements of the Companies Act of South Africa as applicable to annual financial
statements. Reading the summary consolidated financial statements and the auditor’s report thereon, therefore,
is not a substitute for reading the audited consolidated financial statements and the auditor’s report thereon.

The Audited Consolidated Financial Statements and Our Report Thereon
We expressed an unmodified audit opinion on the audited consolidated financial statements in our report dated
22 June 2018. That report also includes communication of key audit matters. Key audit matters are those matters that,
in our professional judgment, were of most significance in our audit of the consolidated financial statements of the
current period.

PricewaterhouseCoopers Inc.
Director: Brendan Deegan
Registered Auditor

Cape Town
22 June 2018

PricewaterhouseCoopers Inc.,
5 Silo Square, V&A Waterfront, Cape Town 8002, P O Box 2799, Cape Town 8000
T: +27 (0) 21 529 2000, F: +27 (0) 21 529 3300, www.pwc.co.za

Chief Executive Officer: T D Shango
Management Committee: S N Madikane, J S Masondo, P J Mothibe, C Richardson, F Tonelli, C Volschenk
The Company’s principal place of business is at 4 Lisbon Lane, Waterfall City, Jukskei View, where a list of directors’ names is available for inspection.
Reg. no. 1998/012055/21, VAT reg.no. 4950174682

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201894

Segmental review

Revenue
Year ended 31 March

EBITDA(1)
Year ended 31 March

Trading profit
Year ended 31 March

Internet
Social network services

– Tencent

– Mail.ru
Ecommerce

– Etail

– Travel

– Marketplaces

– Payments

– Classifieds

– Food delivery

– Other

Video entertainment
Media(2)

Corporate services

Intersegmental

2018

US$’m

15 928

12 281

12 024

257

3 647

2 060

276

–

294

628

166

223

3 680

507

(21)

2017

US$’m

10 621

7 692

7 506

186

2 929

1 659

123

327

186

426

155

3 401

588

(50)

Economic interest
Less:
Equity-accounted investments
Consolidated

20 097

14 562

(13 437)

6 660

(8 464)

6 098

%
change

>100

(100)

>100

(14)

(59)

2018

US$’m

3 382

3 997

3 925

(615)

(248)

(59)

–

(60)

(99)

(20)

(129)

627

(22)

–

2017
Restated
US$’m

2 282

2 964

2 888

(682)

(258)

(87)

146

(66)

(319)

(103)

520

(14)

–

3 997

2 828

(3 739)

258

(2 756)

%
change

(5)

(100)

>(100)

(25)

(75)

(57)

(36)

258

2018

US$’m

3 053

3 726

3 675

(673)

(270)

(61)

–

(64)

(114)

(30)

(134)

369

(22)

–

2017
Restated
US$’m

2 030

2 761

2 701

(731)

(281)

(88)

137

(69)

(328)

(107)

287

(14)

–

3 403

2 322

(3 444)

(41)

(2 536)

(214)

%
change

(15)

(100)

>(100)

(25)

(84)

(57)

(36)

Notes
(1) EBITDA refers to earnings before interest, taxation, depreciation and amortisation.
(2)

Includes revenue of US$133m (2017: US$222.4m), EBITDA of US$33.3m (2017: US$55.1m) and trading profit of US$33.3m (2017: US$40.3m) relating to Novus Holdings Limited (Novus).
The group distributed the majority of its shareholding in Novus to its shareholders in September 2017.

Summarised consolidated income statement

Consolidated trading loss

Finance cost on transponder leases

Amortisation of other intangible assets

Other (losses)/gains – net

Retention option expense

Share-based incentives settled in treasury shares
Consolidated operating loss

Year ended
31 March

2018
US$’m

(41)

(101)

(47)

(8)

(52)

(198)

2017
US$’m

(214)

(99)

(57)

(1)

(35)

(360)

For a reconciliation of consolidated operating loss to consolidated profit before taxation, refer to the summarised
consolidated income statement.

Revenue

Cost of providing services and sale of goods

Selling, general and administration expenses

Other (losses)/gains – net
Operating loss

Interest received

Interest paid

Other finance (costs)/income – net

Share of equity-accounted results

Impairment of equity-accounted investments

Dilution gains/(losses) on equity-accounted
investments(1)

(Losses)/gains on acquisitions and disposals
Profit before taxation

Taxation
Profit for the year

Attributable to:

Equity holders of the group

Non-controlling interest

Note
(1)

Includes the gain recognised on the disposal of a 2% interest in Tencent Holdings Limited.

Year ended
31 March

2017
Restated
US$’m

6 098

(3 574)

(2 827)

(57)

(360)

(278)

(899)

1 829

–

(119)

2 169

2 412

(244)

2 168

2 337

(169)

2 168

2018

US$’m

6 660

(4 025)

(2 786)

(47)

(198)

(267)

(319)

3 277

(46)

9 216

(93)

11 658

(360)

11 298

11 357

(59)

11 298

%
change

>100

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201896

Summarised consolidated income statement
continued

Summarised consolidated statement
of comprehensive income

Core headline earnings for the year (US$’m)

Core headline earnings per N ordinary share
(US cents)

Diluted core headline earnings per N ordinary share
(US cents)

Headline earnings for the year (US$’m)

Headline earnings per N ordinary share (US cents)

Diluted headline earnings per N ordinary share
(US cents)

Earnings per N ordinary share (US cents)

Diluted earnings per N ordinary share (US cents)

Net number of shares issued (’000)

– At year-end

– Weighted average for the year

– Diluted weighted average

Year ended
31 March

2017
Restated
US$’m

1 454

337

330

188

542

535

2018

US$’m

2 507

581

568

1 794

416

403

2 631

2 612

432 126

431 635

433 003

431 540

431 207

432 684

%
change

>100

Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change
in accounting policy.

Profit for the year(1)

Total other comprehensive income, net of tax, for the year(2)

Translation of foreign operations(3)

Net fair value (losses)/gains

Cash ﬂow hedges

Share of other comprehensive income and reserves of equity-accounted investments

Tax on other comprehensive income
Total comprehensive income for the year

Attributable to:

Equity holders of the group

Non-controlling interest

Year ended
31 March

2018

US$’m

11 298

1 742

996

(4)

(98)

835

13 040

13 025

13 040

2017
Restated
US$’m

2 168

1 541

322

(1)

(85)

1 293

3 709

3 905

(196)

3 709

Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change
in accounting policy.

Notes
(1)
(2) These components of other comprehensive income may subsequently be reclassified to profit or loss except for gains of US$361m

Includes the gain recognised on the disposal of a 2% interest in Tencent Holdings Limited.

(2017: US$292m) included in the “Share of other comprehensive income and reserves of equity-accounted investments”.

(3) The movement on the foreign currency translation reserve for the year relates primarily to the effects of foreign exchange rate fluctuations related to

the group’s net investments in its foreign operations.

Summarised consolidated statement
of financial position

Balance at the beginning of the year

Change in accounting policy

Restated balance at the beginning of the year
Changes in share capital and premium

Movement in treasury shares

Share capital and premium issued
Changes in reserves

Total comprehensive income for the year

Movement in share-based compensation reserve

Movement in existing control business combination reserve

Direct retained earnings and other movements

Dividends paid to Naspers shareholders
Changes in non-controlling interest

Total comprehensive income for the year

Dividends paid to non-controlling shareholders

Movement in non-controlling interest in reserves
Balance at the end of the year

Comprising:

Share capital and premium

Retained earnings

Share-based compensation reserve

Existing control business combination reserve

Hedging reserve

Valuation reserve

Foreign currency translation reserve

Non-controlling interests
Total

ASSETS

Non-current assets

Property, plant and equipment

Goodwill

Other intangible assets

Investments in associates

Investments in joint ventures

Other investments and loans

Other receivables

Derivative financial instruments

Deferred taxation
Current assets

Inventory

Programme and film rights

Trade receivables

Other receivables and loans

Derivative financial instruments

Cash and cash equivalents

Assets classified as held for sale
Total assets

Year ended
31 March

2018

US$’m

13 142

–

13 142

(64)

13 025

(48)

(195)

125

(262)

(153)

2017
Restated
US$’m

10 654

(1 504)

9 150

(77)

3 905

(376)

721

(158)

(196)

(116)

217

25 691

13 142

4 965

20 132

1 460

(1 847)

(106)

1 679

(761)

169

25 691

4 944

8 912

1 147

(1 652)

(30)

1 387

(1 852)

286

13 142

Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change
in accounting policy.

31 March

2018

US$’m

22 386

1 638

2 607

1 143

16 666

115

117

13 065

231

240

452

762

11 369

13 065

–

35 451

2017
Restated
US$’m

1 April
2016
Restated
US$’m

16 291

13 486

1 638

2 442

1 104

10 784

128

5 639

154

193

420

456

4 007

5 236

403

1 443

2 818

1 190

7 625

218

–

115

3 237

194

160

393

491

1 714

3 011

226

21 930

16 723

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201898

Summarised consolidated statement
of financial position
continued

EQUITY AND LIABILITIES

Share capital and reserves

Share capital and premium

Other reserves

Retained earnings

Non-controlling interests
Total equity

Non-current liabilities

Capitalised finance leases

Liabilities – interest bearing

– non-interest bearing

Other non-current liabilities

Post-employment medical liability

Derivative financial instruments

Deferred taxation
Current liabilities

Current portion of long-term debt

Trade payables

Accrued expenses and other current liabilities

Derivative financial instruments

Bank overdrafts and call loans

Liabilities classified as held for sale
Total equity and liabilities

Net asset value per N ordinary share (US cents)

Summarised consolidated statement
of cash flows

31 March

2018

US$’m

25 522

4 965

425

20 132

169

25 691

5 623

1 086

3 202

867

157

259

4 137

280

564

3 163

129

4 137

–

35 451

5 906

2017
Restated
US$’m

12 856

4 944

(1 000)

8 912

286

13 142

5 349

1 142

2 198

1 708

265

3 439

915

487

1 844

119

3 369

21 930

2 979

1 April
2016
Restated
US$’m

8 771

4 965

(2 304)

6 110

379

9 150

5 118

771

2 922

1 098

286

2 455

227

437

1 662

2 358

16 723

2 035

Cash flows from operating activities

Cash generated from operating activities

Interest income received

Dividends received from investments and equity-accounted companies

Interest costs paid

Taxation paid
Net cash utilised in operating activities

Cash flows from investing activities

Acquisitions and disposals of tangible and intangible assets

Acquisitions of subsidiaries, associates and joint ventures

Disposals of subsidiaries, associates and joint ventures

Cash movement in other investments and loans
Net cash generated from investing activities

Cash flows from financing activities

Proceeds from long- and short-term loans raised

Repayments of long- and short-term loans

Outﬂow from share-based compensation transactions

Dividends paid by the holding company and its subsidiaries

Other movements resulting from financing activities
Net cash utilised in financing activities

Net movement in cash and cash equivalents

Foreign exchange translation adjustments on cash and cash equivalents

Cash and cash equivalents at the beginning of the year

Cash and cash equivalents classified as held for sale
Cash and cash equivalents at the end of the year

Year ended
31 March

2018
US$’m

2017
US$’m

141

251

(240)

(391)

(158)

(138)

(1 957)

9 941

7 853

1 124

(827)

(22)

(344)

(319)

(388)

7 307

4 003

–

11 368

294

193

(257)

(333)

(40)

(173)

(397)

3 383

2 814

584

(602)

(36)

(281)

(76)

(411)

2 363

(50)

1 713

(23)

4 003

Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change
in accounting policy.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 201899

The recent change in commercial intent to settle put options in cash rather than Naspers N ordinary shares, has prompted
us to reassess our accounting policy to ensure it remains reflective of the underlying settlement expectations. IFRS does not
explicitly address accounting for put option liabilities that can be settled by issuing a variable number of an entity’s own shares,
as evidenced in the IFRS Interpretations Committee November 2016 rejection of this matter. As a result, an accounting policy
choice exists – they can either be accounted for as (i) derivative financial instruments (at fair value in terms of IAS 39 Financial
Instruments: Recognition and Measurement or IFRS 9 Financial Instruments), or (ii) as liabilities equal to the amount payable on
settlement (in terms of IAS 32 Financial Instruments: Presentation).

Up to 30 September 2017, put option liabilities were accounted for as derivative financial instruments given the historic
intention to settle in Naspers N ordinary shares. All put option liabilities were measured at a fair value of zero as these options
are priced at fair value, consequently there was no impact on the statement of financial position or income statement.

Given the intention to now settle in cash, it is more appropriate to recognise them as liabilities in the statement of financial
position, at amounts reflecting the gross cash consideration payable on settlement. Consequently, in accordance with IAS 8,
we have changed our accounting policy in this respect. Going forward, all remeasurements of these liabilities will be recognised
in the income statement. These remeasurements will be included in headline earnings but excluded from core headline
earnings.

The group has applied the change in accounting policy retrospectively and has restated the comparative information
presented in these summarised consolidated financial statements for the year ended 31 March 2017. The summarised impact
of the change in accounting policy on prior-period results is an increase in liabilities of US$2.22bn as at 31 March 2017, as well
as the recognition of a remeasurement expense (including foreign exchange translation effects) in the income statement of
US$640m for the year ended 31 March 2017.

The impact of the change in accounting policy on the summarised consolidated financial statements is outlined in the extracts
that follow.

Notes to the summarised consolidated financial statements
for the year ended 31 March

Basis of presentation and accounting policies
The summarised consolidated financial results for the year ended 31 March 2018 are prepared in accordance with the JSE
Limited (the JSE) Listings Requirements relevant to summarised financial statements and the provisions of the Companies Act
No 71 of 2008. The JSE Listings Requirements require summary financial statements to be prepared in accordance with the
framework concepts, the measurement and recognition requirements of International Financial Reporting Standards (IFRS),
the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as
issued by the Financial Reporting Standards Council, and to also, as a minimum, contain the information required by IAS 34
Interim Financial Reporting. The summarised consolidated financial results do not include all the disclosures required for
complete annual financial statements prepared in accordance with IFRS as issued by the International Accounting Standards
Board (IASB). The accounting policies applied in the preparation of the consolidated annual financial statements from which
the summarised consolidated financial results were derived, are consistent with those applied in the previous consolidated
annual financial statements, except as set out below.

The group has adopted all new and amended accounting pronouncements issued by the IASB that are effective for financial
years commencing 1 April 2017. None of the new or amended accounting pronouncements that are effective for the financial
year commencing 1 April 2017 had a material impact on the group.

The group’s reportable segments reflect the components of the group that are regularly reviewed by the chief executive and
other senior executives who make strategic decisions. The group proportionately consolidates its share of the results of its
associates and joint ventures in its reportable segments.

Trading profit excludes amortisation of intangible assets (other than software), equity-settled share-based payment expenses
relating to transactions to be settled through the issuance of treasury shares, retention option expenses and other gains/losses,
but includes the finance cost on transponder leases.

Core headline earnings exclude once-off and non-operating items. We believe it is a useful measure of the group’s operating
performance. However, this is not a defined term under IFRS and may not be comparable with similarly titled measures
reported by other companies.

Change in accounting policy regarding written put option liabilities
As part of its commitment to build shareholder value and prevent dilution, we indicated recently that we are unlikely to issue
Naspers N ordinary shares to settle put option liabilities arising from mergers and acquisitions agreements, employee share
option obligations or similar arrangements. Instead, the intention is to settle these items in cash, either through purchases of
shares on the market or direct cash settlement.

When investing, we frequently partner with founders who remain in the business as non-controlling shareholders. To provide
them with liquidity at a later date, agreements sometimes include put options that require the group to purchase the shares of
non-controlling shareholders in future, with the option to settle by issuing Naspers N ordinary shares or in cash. In the past
we selected to settle some of these by issuing Naspers N ordinary shares.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018
100

Notes to the summarised consolidated financial statements continued
for the year ended 31 March

Basis of presentation and accounting policies continued
Change in accounting policy regarding written put option liabilities continued

Statement of financial position (extract)

2017

Restated
US$’m

31 March

2017
Change in
accounting
policy
US$’m

2017

2016

Previously
reported
US$’m

Restated
US$’m

1 April

2016
Change in
accounting
policy
US$’m

2016

Previously
reported
US$’m

12 856

(2 102)

14 958

8 771

(1 483)

10 254

4 944

(1 000)

8 912

286

13 142

5 349

1 708

3 439

1 768

–

(1 518)

(584)

(117)

(2 219)

1 708

511

4 944

518

9 496

403

15 361

3 641

–

2 928

511

1 257

4 965

(2 304)

6 110

379

9 150

5 118

1 098

2 455

1 595

–

(1 483)

–

(21)

(1 504)

1 095

409

4 965

(821)

6 110

400

10 654

4 023

2 046

409

1 186

21 930

–

21 930

16 723

–

16 723

EQUITY AND
LIABILITIES

Capital and reserves
attributable to the
group’s equity holders

Share capital and premium

Other reserves

Retained earnings
Non-controlling interests

TOTAL EQUITY

Non-current
liabilities (subtotal)

Other non-current liabilities
Current liabilities
(subtotal)

Accrued expenses and
other current liabilities
TOTAL EQUITY
AND LIABILITIES

Income statement (extract)

Other finance (costs)/income – net
Profit before taxation

Taxation
Profit for the year

Attributable to:

Equity holders of the group

Non-controlling interests

Earnings per N ordinary share (US cents)

Basic

Diluted
Headline earnings per N ordinary share (US cents)

Basic

Diluted

Statement of comprehensive income

Profit for the year

Other comprehensive income for the year
Total comprehensive income for the year

Attributable to:

Equity holders of the group

Non-controlling interests

31 March

2017
Change in
accounting
policy
US$’m

2017

Restated
US$’m

2017

Previously
reported
US$’m

(899)

2 412

(244)

2 168

2 337

(169)

2 168

542

535

2 168

1 541

3 709

3 905

(196)

3 709

(640)

–

(640)

(584)

(56)

(640)

(135)

(640)

(4)

(644)

(587)

(57)

(644)

(259)

3 052

(244)

2 808

2 921

(113)

2 808

677

670

179

173

2 808

1 545

4 353

4 492

(139)

4 353

The group’s change in accounting policy regarding put options had no impact on core headline earnings.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018101

Change in calculation of trading profit and core headline earnings
IFRS 8 Operating Segments requires segmental reporting to reflect the manner in which financial information is communicated
internally to management. We therefore report trading profit on an economic-interest basis (ie including a proportionate
consolidation of the trading profits of associates and joint ventures) in the segmental review which, similar to core headline
earnings, excludes amortisation expenses on certain intangible assets. For the reasons outlined above, we will similarly no
longer adjust trading profit to exclude the amortisation expenses recognised by Tencent on its digital content. The effect is to
adjust trading profit downward from US$ 2.7bn to US$ 2.3bn for the year ended 31 March 2017. Consolidated trading profit
is unaffected by this change.

To ensure comparability between reporting periods, we have updated the comparative information for trading profit
and core headline earnings (including basic and diluted per-share equivalents) in these summarised consolidated financial
statements. The change to trading profit and core headline earnings had no impact on the group’s statement of financial
position and income statement presented in accordance with IFRS.

Notes to the summarised consolidated financial statements continued
for the year ended 31 March

Basis of presentation and accounting policies continued
Change in calculation of trading profit and core headline earnings
The group is required to calculate and present headline earnings (and the related basic and diluted per-share equivalents)
in terms of the JSE Listings Requirements. Headline earnings represents an earnings metric that is intended to provide
a like-for-like basis on which the earnings of entities can be compared.

In addition to headline earnings, we also calculate and present trading profit and core headline earnings. These are non-IFRS,
Naspers-defined metrics and are presented as additional information to shareholders as we consider them more reflective
of our operating performance. In arriving at core headline earnings, adjustments are made to the earnings of consolidated
businesses, as well as the underlying earnings of associates and joint ventures, to the extent that the information is available.

Ensuring that core headline earnings remains reflective of our future potential operating performance, a review of the items
adjusted for in the calculation is required as circumstances change.

We have historically adjusted core headline earnings for all amortisation expenses, excluding software, as these expenses have
primarily related to intangible assets resulting from business combinations and other acquisitions. These expenses are not
considered operational in nature.

Our associate Tencent has, in recent years, made a strategic decision to develop a number of digital content offerings
(including video and music), with significant success. Consequently, acquired content now represents a meaningful part of the
overall cost base for the digital content business, resulting in an increase in intangible assets and related amortisation expenses.
As a result of this development, we considered it prudent to refine the treatment of amortisation within the core headline
earnings calculation and to now include the digital-content element of Tencent’s amortisation expenses in core headline
earnings. Only amortisation related to intangible assets identified in business combinations and other acquisitions continues
to be adjusted for in the core headline earnings calculation. The effect is to adjust core headline earnings downward from
US$1.8bn to US$1.5bn for the year ended 31 March 2017.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018
102

Notes to the summarised consolidated financial statements continued
for the year ended 31 March

Headline and core headline earnings

Interest (paid)/received

Interest received

– loans and bank accounts
– other
Interest paid

– loans and overdrafts
– transponder leases
– other
Other finance (cost)/income – net

– net foreign exchange differences and fair-value adjustments on derivatives
– remeasurement of written put option liabilities

Year ended
31 March

2018

US$’m

2017
Restated
US$’m

88
74
14
(267)
(196)
(51)
(20)
(319)
(67)
(252)

70
56
14
(278)
(198)
(46)
(34)
(899)
(277)
(622)

Net profit attributable to shareholders

Adjusted for:

– impairment of property, plant and equipment and other assets
– impairment of goodwill and other intangible assets
– (profit)/loss on sale of assets
– loss on remeasurement of disposal groups classified as held for sale to fair value

less costs of disposal

– losses/(gains) on acquisitions and disposals of investments
– remeasurement of previously held interest
– dilution (gains)/losses on equity-accounted investments(1)
– remeasurements included in equity-accounted earnings
– impairment of equity-accounted investments

Total tax effects of adjustments
Total adjustment for non-controlling interest
Headline earnings
Adjusted for:

– equity-settled share-based payment expenses
– amortisation of other intangible assets(2)
– fair-value adjustments and currency translation differences(3)
– retention option expense
– business combination-related losses
Core headline earnings

Year ended
31 March

2018

US$’m

11 357

39
4
(1)
–

95
(21)
(9 216)
(524)
46
1 779
18
(3)
1 794

435
190
60
8
20
2 507

2017
Restated
US$’m

2 337

26
28
1
2

(2 219)
–
119
(102)
–
192
(17)
13
188

296
169
756
1
44
1 454

Includes the gain recognised on the disposal of a 2% interest in Tencent Holdings Limited.

Notes
(1)
(2) Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change in calculation of core headline
earnings. Amortisation of other intangible assets for the year ended 31 March 2017 has been adjusted to include amortisation expenses of US$298m
regarding Tencent’s digital content business.

(3) Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change in accounting policy. Fair-value

adjustments and currency translation differences for the year ended 31 March 2017 has been adjusted by US$584m for the impact of remeasurements of
written put options.

The diluted earnings, headline earnings and core headline earnings per-share figures presented on the face of the income
statement include a decrease of US$49m (2017: US$24m) relating to the future dilutive impact of potential ordinary
shares issued by equity-accounted investees and subsidiaries.

103

Equity-accounted results

Profit before taxation

The group’s equity-accounted investments contributed to the summarised consolidated financial results as follows:

In addition to the items already detailed, profit before taxation has been determined after taking into account, inter alia,
the following:

Share of equity-accounted results

– sale of assets

– disposal of investments

– impairment of investments
Contribution to headline earnings

– amortisation of other intangible assets

– equity-settled share-based payment expenses

– fair-value adjustments and currency translation differences
Contribution to core headline earnings

Tencent

Mail.ru

MakeMyTrip

Delivery Hero

Other

Year ended
31 March

2018

US$’m

3 277

(692)

159

2 745

135

385

(224)

3 041

3 288

(76)

(21)

(187)

2017
Restated
US$’m

1 829

(381)

268

1 719

106

268

–

2 093

2 237

–

(196)

The group applies an appropriate lag period in reporting the results of equity-accounted investments where the
year-ends of investees are not coterminous with that of Naspers Limited.

Depreciation of property, plant and equipment

Amortisation

– other intangible assets

– software
Costs related to programme and film rights, including amortisation

Net realisable value adjustments on inventory, net of reversals(1)

Other (losses)/gains – net

– gain/(loss) on sale of assets

– impairment of goodwill and other intangible assets

– impairment of property, plant and equipment and other assets

– remeasurement of disposal groups classified as held for sale to fair value

less costs of disposal

– dividends received on investments

– fair-value adjustments on financial instruments

– other
(Losses)/gains on acquisitions and disposals

– (loss)/profit on sale of investments

– gains recognised on loss of control transactions

– remeasurement of contingent consideration

– acquisition-related costs

– remeasurement of previously held interest

Note
(1) Net realisable value write-downs relate primarily to set-top box subsidies in the video-entertainment segment.

Year ended
31 March

2018
US$’m

2017
US$’m

219

133

101

912

(47)

(4)

(39)

–

(6)

(2)

(93)

(91)

–

(5)

(18)

214

128

859

(57)

(1)

(30)

(26)

(2)

–

2 169

1 990

228

(50)

–

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018104

Notes to the summarised consolidated financial statements continued
for the year ended 31 March

Goodwill

Commitments and contingent liabilities

Goodwill is subject to an annual impairment assessment. Movements in the group’s goodwill for the year are
detailed below:

Commitments relate to amounts for which the group has contracted, but that have not yet been recognised as
obligations in the statement of financial position.

Goodwill

– cost

– accumulated impairment
Opening balance

– foreign currency translation effects

– acquisitions of subsidiaries and businesses

– disposals of subsidiaries and businesses

– transferred to assets classified as held for sale

– impairment

– remeasurement to fair value less costs of disposal

Closing balance

– cost

– accumulated impairment

Year ended
31 March

2018
US$’m

2017
US$’m

2 790

(348)

2 442

124

–

2 607

2 961

(354)

3 175

(357)

2 818

210

244

(786)

(37)

(5)

(2)

2 442

2 790

(348)

Commitments

– capital expenditure

– programme and film rights

– network and other service commitments

– operating lease commitments

– set-top box commitments

Year ended
31 March

2018
US$’m

3 537

2 906

104

327

183

2017
US$’m

2 464

2 015

158

163

115

The group operates a number of businesses in jurisdictions where taxes are payable on certain transactions or
payments. The group continues to seek relevant advice and works with its advisers to identify and quantify such tax
exposures. Our current assessment of possible withholding and other tax exposures, including interest and potential
penalties, amounts to approximately US$226.1m (2017: US$256.7m). No provision has been made as at 31 March 2018
and 2017 for these possible exposures.

Disposal groups classified as held for sale

During the year ended 31 March 2017 the group announced the unbundling of the majority of its shareholding in its
subsidiary Novus Holdings Limited (Novus), operating in the print industry in South Africa. The assets and liabilities
of Novus were classified as held for distribution as at 31 March 2017. In August 2017 the group received regulatory
approval for the unbundling which was finalised during September 2017.

In May 2017 the group concluded the disposal of its joint venture Souq Group Limited (Souq), following the receipt
of regulatory approval. Souq was classified as held for sale as at 31 March 2017.

The group also concluded the disposals of various other smaller units of which the assets and liabilities were classified
as held for sale as at 31 March 2017.

Disposal groups classified as held for sale continued
The group had no assets and liabilities classified as held for sale as at 31 March 2018. Assets and liabilities classified as held
for sale in prior periods are detailed in the following table:

Assets

Property, plant and equipment

Goodwill and other intangible assets

Investment in joint venture

Deferred taxation assets

Inventory

Trade and other receivables

Cash and cash equivalents
Liabilities

Deferred taxation liabilities

Long-term liabilities

Trade payables

Accrued expenses and other current liabilities

Year ended
31 March

2018
US$’m

2017
US$’m

–

403

176

102

The group recognised a loss of US$nil (2017: US$1.6m) as part of “Other (losses)/gains – net” in the income statement
on remeasuring the net assets of businesses classified as held for sale to their fair value less costs of disposal during the
year. The fair value of the businesses was determined based on third-party sales prices. This represents a level 3
fair-value measurement.

Business combinations, other acquisitions and disposals

In August 2017 the group invested US$74m to acquire a controlling interest in its associate Takealot Online (RF) Proprietary
Limited (Takealot), the leading etailer in South Africa. Following the investment, the group held a 58% effective interest in
Takealot. The transaction was accounted for as a business combination with an effective date of August 2017. The total
purchase consideration amounted to US$123m representing the fair value of the group’s previously held equity interest in
Takealot. A gain of US$20m has been recognised in “(Losses)/gains on acquisitions and disposals” in the income statement
on the remeasurement of the group’s previously held equity interest in Takealot to its fair value. The US$74m cash invested
remains within the group following the transaction and is accordingly not disclosed as part of the consideration transferred
by the group or assets of Takealot acquired, although it did affect the amount of goodwill recognised in the business
combination. The purchase price allocation: property, plant and equipment US$13m; cash and deposits US$105m;
inventories US$28m; trade and other receivables US$4m; intangible assets US$107m; trade and other payables US$27m;
deferred tax liabilities US$30m and the balance of US$81m to goodwill. The main classes of intangible assets recognised in
the business combination were trade names and brands, customer relationships and technology. The transaction gave rise
to the recognition of non-controlling interest of US$83m, which has been measured at the non-controlling interest’s
proportionate share of the identifiable net assets of Takealot as at the acquisition date.

105

In December 2017 the group acquired an additional 38% interest in Takealot from non-controlling shareholders. The
transaction was settled in Naspers N ordinary shares, purchased on the open market, with a fair value of US$128m on
settlement date. The excess of the consideration transferred over the net asset value acquired was recognised in the
“Existing control business combination reserve” in equity and totalled US$65m. An amount of US$4m was recognised in
the valuation reserve being the difference between the fair value and acquisition cost of the shares transferred. Following
the transaction, the group holds a 96% effective interest (91% fully diluted) in Takealot.

In November 2017 the group invested US$41m to acquire a 100% effective interest in The Car Trader Proprietary Limited
(AutoTrader), an online automobile classifieds vertical in South Africa. The transaction was accounted for as a business
combination with an effective date of November 2017. The total purchase consideration amounted to US$41m. The
purchase price allocation: property, plant and equipment US$1m; cash and deposits US$3m; trade and other receivables
US$1m; intangible assets US$27m; trade and other payables US$4m; loan liabilities US$14m; deferred tax liabilities US$8m
and the balance of US$35m to goodwill. The main classes of intangible assets recognised in the business combination were
brands, customer relationships and technology.

Since the acquisition dates of the above business combinations, revenue of US$195m and net results/(losses) of US$41m
have been included in the income statement relating to Takealot and AutoTrader. Had the revenue and net results of
Takealot and AutoTrader been included from 1 April 2017, group revenue and net profit would have amounted to
US$6.75bn and US$11.26bn respectively.

The main factor contributing to the goodwill recognised in the acquisitions is the acquirees’ market presence. The goodwill
that arose is not expected to be deductible for income tax purposes. Total acquisition-related costs of US$3m were
recorded in “(Losses)/gains on acquisitions and disposals” in the income statement regarding the above-mentioned
acquisitions.

The following relates to the group’s investments in its equity-accounted investees:

The group made various investments in Delivery Hero AG (Delivery Hero), a global online food-ordering and delivery
marketplace, during the year. In May 2017 the group acquired its initial interest in Delivery Hero through an investment of
US$426m. On 30 June 2017, Delivery Hero successfully completed an initial public offering of its shares, a process during
which the group invested a further US$47m. Following these investments, the group held an 11% effective interest (10%
fully diluted) in Delivery Hero. In December 2017 the group invested an additional US$47m as part of a private placement
in order to maintain its relative shareholding. During March 2018, following the receipt of regulatory approval, the group
acquired Rocket Internet SE’s interest in Delivery Hero for US$778m. The group’s aggregate investment in Delivery Hero
therefore amounts to US$1.3bn over the reporting period. Following the acquisition from Rocket Internet SE, the group
holds a 23% effective interest (22% fully diluted) in Delivery Hero. The group accounts for its interest in Delivery Hero as
an investment in an associate.

The group made two investments during June 2017 and February 2018 amounting to US$121m in total, in Bundl
Technologies Private Limited (Swiggy), the operator of a first-party food-delivery marketplace in India. Following these
investments, the group holds a 22% effective interest (21% fully diluted) in Swiggy. The group accounts for its interest in
Swiggy as an investment in an associate.

In May 2017 the group invested US$99m in Kreditech Holding SSL GmbH (Kreditech), a provider of consumer lending and
financial services. The group has also provided convertible loan funding of €20m to Kreditech. Following the investment, the
group holds a 38% effective interest (31% fully diluted) in Kreditech. The group accounts for its interest in Kreditech as an
investment in an associate.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018106

Notes to the summarised consolidated financial statements continued
for the year ended 31 March

Business combinations, other acquisitions and disposals continued
During May 2017 the group invested US$132m in its associate MakeMyTrip Limited (MakeMyTrip) as part of a funding
round. In August and September 2017, following MakeMyTrip’s issue of share options to its employees, the group invested
US$23m to maintain its relative shareholding. Following these transactions, the group holds a 43% effective interest (40%
fully diluted) in MakeMyTrip.

The group invested US$71m for an additional interest in its associate Flipkart Limited (Flipkart) in April 2017. The additional
interest was acquired from existing shareholders of Flipkart. Flipkart undertook various funding rounds during the year
in which the group did not participate. These funding rounds resulted in a dilution of the group’s interest in Flipkart and in
the recognition of an aggregate net dilution gain of US$252m in “Dilution gains/(losses) on equity-accounted investments”
in the income statement. Following the dilutions, the group holds a 12% effective interest (11% fully diluted) in Flipkart.

In November 2017 the group invested US$100m in Remitly, Inc. (Remitly), a global digital money-transfer service. The
investment resulted in the group acquiring a 23% effective interest (20% fully diluted) in Remitly. The group accounts for its
interest in Remitly as an investment in an associate.

The following relates to significant disposals by the group during the reporting period:

During May 2017 the group disposed of its investment in its joint venture Souq Group Limited for a consideration of
US$173m. A gain on disposal of US$89m has been recognised in “(Losses)/gains on acquisitions and disposals” in the income
statement following the transaction.

In September 2017, following the receipt of regulatory approval, the group distributed the majority of its shareholding
in Novus Holdings Limited (Novus) to its shareholders. The group recognised the distribution as an in specie dividend,
reducing retained earnings by US$69m, being the fair value of the distributed Novus shares. A loss on disposal of US$145m
has been recognised in “(Losses)/gains on acquisitions and disposals” in the income statement following the distribution,
being the difference between the fair value of the distributed Novus shares and the book value of the assets distributed
as well as the reclassification of reserves of US$112m. After the distribution, the group holds a 19% interest in Novus and
accounts for this interest as an available-for-sale investment.

During February 2018 the group disposed of its investment in its joint venture Konga Online Shopping Limited. A loss on
disposal of US$38m, representing the reclassification of the group’s foreign currency translation reserve from other
comprehensive income to the income statement, has been recognised in “(Losses)/gains on acquisitions and disposals”.

In March 2018 the group disposed of approximately 6% of its interest in its associate, Tencent Holdings Limited (Tencent).
The disposal was executed by way of an accelerated offering by private placement on the Hong Kong Stock Exchange for
a cash consideration of US$9.76bn. The disposal reduced the group’s shareholding from 33.17% to 31.17%. A dilution gain
of US$9.1bn has been recognised in “Dilution gains/(losses) on equity-accounted investments” following the transaction,
resulting in a cumulative net dilution gain of US$8.98bn for the year on the group’s investment in Tencent.

Issue of listed bond

The group issued a 10-year US$1.0bn international bond in July 2017. The bond matures in July 2027 and carries a fixed
interest rate of 4.85% per annum. The proceeds were partially utilised to repay the group’s US$700m international bond
which matured in July 2017. The remaining proceeds will be utilised for general corporate purposes, including acquisitions.

Financial instruments

The fair values of the group’s financial instruments that are measured at fair value at each reporting period are
categorised as follows:

Fair-value measurements
at 31 March 2018 using:

Quoted prices in active
markets for identical
assets or liabilities
(level 1)
US$’m

Significant other
observable inputs
(level 2)
US$’m

Significant
unobservable
inputs
(level 3)
US$’m

–

162

–

124

–

Fair-value measurement
at 31 March 2017 using:

Quoted prices in active
markets for identical
assetsor liabilities
(level 1)
US$’m

Significant other
observable inputs
(level 2)
US$’m

Significant
unobservable
inputs
(level 3)
US$’m

11
–
–

–
–
–
–

2
2
–

106
–
–
8

–
–
6

–
18
24
–

Assets

Available-for-sale investments

Forward exchange contracts

Derivatives embedded in leases

Currency devaluation features
Liabilities

Forward exchange contracts

Earn-out obligations

Interest rate and cross-currency swaps

Assets

Available-for-sale investments
Forward exchange contracts
Currency devaluation features
Liabilities

Forward exchange contracts
Shareholders’ liabilities
Earn-out obligations
Interest rate swaps

Financial instruments continued
There have been no transfers between levels 1 or 2 during the reporting period, nor were there any significant changes
to the valuation techniques and inputs used in measuring fair value.

Currency devaluation features relate to clauses in content acquisition agreements that provide the group with protection
against significant currency devaluations. The fair value of currency devaluation features is measured through the use of
discounted cash flow techniques.

For earn-out obligations, current forecasts of the extent to which management believes performance criteria will be
met, discount rates reflecting the time value of money and contractually specified earn-out payments are used. Changes
in these assumptions could affect the reported fair value of these financial instruments.

The fair value of level 2 financial instruments is determined with the use of exchange rates quoted in active markets and
interest rate extracts from observable yield curves.

Financial instruments for which fair value is disclosed:

31 March 2018

Financial liabilities

Capitalised finance leases

Publicly traded bonds

31 March 2017

Financial liabilities
Capitalised finance leases(1)

Publicly traded bonds

Carrying
value
US$’m

1 158

3 200

Carrying
value
US$’m

1 211

2 900

Fair
value
US$’m

1 125

3 357

Fair
value
US$’m

1 199

3 041

Note
(1)

Includes financial liabilities classified as held for sale.

The fair values of the capitalised finance leases have been determined through discounted cash flow analysis. The fair
values of the publicly traded bonds have been determined with reference to the listed prices of the instruments as at the
end of the reporting period.

107

Related party transactions and balances

The group entered into various related party transactions in the ordinary course of business. There have been no
significant changes in related party transactions and balances since the previous reporting period.
Events after the reporting period

In April 2018 the group acquired the share capital held by non-controlling shareholders of its subsidiary Dubizzle Limited
(Dubizzle) for US$190m. Following the acquisition, the group holds a 100% effective interest in Dubizzle.

In May 2018 the group announced the sale of its interest in Flipkart Limited – its equity-accounted etail investment in
India – to US-based retailer Walmart Inc. for US$2.2bn. The transaction is subject to regulatory approval.

In May 2018 the group invested US$35m for a 16% effective interest in Honor Technology Inc., a first-of-its-kind
home-care company providing in-home senior care.

In May 2018 the group invested US$89m for a 36% effective interest in FCG Germany GmbH (Frontier Car Group),
an online car marketplace headquartered in Berlin.

In June 2018 the group committed to an investment of US$80m in its associate, Bundl Technologies Private Limited
(Swiggy), the operator of a first-party food-delivery marketplace in India. Following this investment, the group will hold
a 24% effective interest (23% fully diluted) in Swiggy.

Pro forma financial information

The group has presented certain revenue and trading profit metrics in local currency, excluding the effects of changes
in the composition of the group (the pro forma financial information) in the following tables. The pro forma financial
information is the responsibility of the board of directors (the board) of Naspers Limited and is presented for illustrative
purposes. Information presented on a pro forma basis has been extracted from the group’s management accounts, the
quality of which the board is satisfied with.

Shareholders are advised that, due to the nature of the pro forma financial information and the fact that it has been
extracted from the group’s management accounts, it may not fairly present the group’s financial position, changes in
equity, results of operations or cash flows.

The pro forma financial information has been prepared to illustrate the impact of changes in foreign exchange rates and
changes in the composition of the group on its results for the period ended 31 March 2018. The following methodology
was applied in calculating the pro forma financial information:

1. Foreign exchange/constant currency adjustments have been calculated by adjusting the current period’s results to the

prior period’s average foreign exchange rates, determined as the average of the monthly exchange rates for that
period. The local currency financial information quoted is calculated as the constant currency results, arrived at using
the methodology outlined above, compared to the prior period’s actual IFRS results. The relevant average exchange
rates (relative to the US dollar) used for the group’s most significant functional currencies, were South African rand
(2018: 0.0774; 2017: 0.0713); Polish zloty (2018: 0.2794; 2017: 0.2516); Russian rouble (2018: 0.0173; 2017: 0.0159);
Chinese yuan renminbi (2018: 0.1517; 2017: 0.1483); Indian rupee (2018: 0.0155; 2017: 0.0149); Brazilian real (2018:
0.3097; 2017: 0.3061); and Nigerian naira (2018: 0.0028; 2017: 0.0035).

2. Adjustments made for changes in the composition of the group relate to acquisitions and disposals of subsidiaries and
equity-accounted investments, as well as to changes in the group’s shareholding in its equity-accounted investments.
For mergers, the group composition adjustments include a portion of the prior year’s results of the entity with which
the merger took place. The following significant changes in the composition of the group during the respective
reporting periods have been adjusted for in arriving at the pro forma financial information:

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018
108

Notes to the summarised consolidated financial statements continued
for the year ended 31 March

Pro forma financial information continued

Year ended 31 March 2018

Transaction

Basis of accounting

Reportable segment

Acquisition/Disposal

Associate

Subsidiary

Dilution of the group’s
interest in Tencent

Dilution of the group’s
interest in Mail.ru

Dilution of the group’s
interest in Flipkart

Acquisition of the group’s
interest in Kreditech

Acquisition of the group’s
interest in Delivery Hero

Effect of merger of ibibo
with MakeMyTrip

Disposal of the group’s
interest in Souq

Acquisition of the group’s
interest in Takealot

Acquisition of the group’s
interest in AutoTrader

Disposal of the group’s
interest in Netretail

Disposal of the group’s
interest in Allegro and
Ceneo

Disposal of the group’s
interest in Novus

Social and internet
platforms

Ecommerce

Disposal

Ecommerce

Acquisition

Ecommerce

Acquisition

Ecommerce

Acquisition and
disposal

Disposal

Ecommerce

Acquisition

Ecommerce

Acquisition

Ecommerce

Disposal

Joint venture

Ecommerce

Subsidiary

Media

The net adjustment made for all acquisitions and disposals that took place during the year ended 31 March 2018
amounted to a negative adjustment of US$508m on revenue and a negative adjustment of US$181m on trading profit.

An assurance report issued in respect of the pro forma financial information, by the group’s external auditor, is available
at the registered office of the company.

Media

Corporate services

Intersegmental
Economic interest

588

(50)

The adjustments to the amounts, reported in terms of IFRS, which have been made in arriving at the pro forma financial
information, are presented in the table below:

Year ended 31 March

2017
A

2018
B

2018
C

2018
D

2018
E

2018
F(2)

2018
G(3)

2018
H(4)

Revenue

Internet

Social and internet
platforms

– Tencent

– Mail.ru

Ecommerce

– Etail

– Travel

– Marketplaces

– Payments

– Classifieds

– Food delivery

– Other

IFRS(1)
US$’m

10 621

7 692

7 506

186

2 929

1 659

123

327

186

426

155

Video entertainment

3 401

Group
compo-
sition
disposal
adjust-
ment
US$’m

Group
compo-
sition ac-
quisition
adjust-
ment
US$’m

Foreign
currency
adjust-
ment
US$’m

Local
currency
growth
US$’m

Local
currency
growth
% change

IFRS(1)
US$’m

IFRS
% change

(608)

(45)

(40)

(5)

(563)

(338)

120

(327)

(8)

–

(10)

(73)

(123)

–

295

–

272

167

(20)

–

511

361

341

150

–

119

–

(1)

5 109

4 250

15 928

12 281

4 217

12 024

859

475

–

150

232

257

3 647

2 060

276

–

294

628

166

223

3 680

507

(21)

–

>100

(100)

>100

(14)

14 562

(804)

296

666

5 377

20 097

Notes
(1) Figures presented on an economic-interest basis as per the segmental review.
(2) A + B + C + D + E.
(3) E/(A + B) x 100.
(4)
(F/A) – 1 x 100.

Pro forma financial information continued

Year ended 31 March

2017
A

2018
B

2018
C

2018
D

2018
E

2018
F(2)

2018
G(3)

2018
H(4)

Group
compo-
sition
disposal
adjust-
ment
US$’m

Group
compo-
sition ac-
quisition
adjust-
ment
US$’m

Foreign
currency
adjust-
ment
US$’m

Local
currency
growth
US$’m

Local
currency
growth
% change

IFRS(1)
US$’m

IFRS
% change

(9)

(10)

–

(15)

(100)

(30)

>(100)

(79)

(17)

(15)

(2)

(62)

(137)

(9)

–

(1)

(2)

(18)

–

(99)

(90)

(7)

–

(7)

(83)

(39)

–

(17)

(23)

(9)

–

102

1 090

897

3 053

3 726

902

3 675

(8)

–

(2)

–

(4)

(5)

193

(21)

–

195

(13)

(18)

(6)

(4)

(673)

(270)

(61)

–

(64)

(114)

(134)

369

(22)

(82)

115

1 147

3 403

Trading profit

Internet

Social and internet
platforms
– Tencent(5)

– Mail.ru

Ecommerce

– Etail

– Travel

– Marketplaces

– Payments

– Classifieds

– Food delivery

– Other

Video entertainment

Media

Corporate services
Economic interest

IFRS(1)
US$’m

2 030

2 761

2 701

(731)

(281)

(88)

137

(69)

(328)

(107)

287

(14)

2 322

Notes
(1) Figures presented on an economic-interest basis as per the segmental review.
(2) A + B + C + D + E.
(3) E/(A + B) x 100.
(4)
(F/A) – 1 x 100.
(5) Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change in calculation of trading profit.

109

2017
A

IFRS
US$’m

2018
B

Group
compo-
sition
disposal
adjust-
ment
US$’m

Year ended 31 March

2018
C

2018
D

2018
E

2018
F(1)

2018
G(2)

2018
H(3)

Group
compo-
sition ac-
quisition
adjust-
ment
US$’m

Foreign
currency
adjust-
ment
US$’m

Local
currency
growth
US$’m

Local
currency
growth
% change

IFRS
US$’m

IFRS
% change

1 084

861

6 098

2 173

(214)

204

(15)

(85)

(780)

(586)

–

287

286

(34)

(51)

–

268

114

(131)

956

(122)

787

669

6 660

511

2 498

(12)

(17)

(12)

(22)

227

(41)

(92)

(81)

284

Other metrics
reported

Development
spend

– economic
interest

– consolidated

Consolidated
revenue

Consolidated
ecommerce
revenue

Consolidated
trading loss

Avito revenue

(17)

>(100)

(29)

(25)

(84)

(57)

Core headline earnings, calculated in local currency terms, amounted to US$2.42bn.

Development spend is not an IFRS measure and has therefore been excluded from the assurance report issued by the
group’s external auditor.

Notes
(1) A + B + C + D + E.
(2) E/(A + B) x 100.
(3)
(F/A) – 1 x 100.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018

110

Further

information

Shenzhen, China

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018111

Notice of annual general meeting

Notice is hereby given in terms of the
Companies Act No 71 of 2008, as
amended (the Act), that the 104th
annual general meeting of Naspers
Limited (the company or Naspers) will
be held on the 2nd floor, Daisy Room,
Cape Town International Convention
Centre 2 (CTICC2), corner of
Heerengracht and Rua Bartholomeu
Dias, Foreshore, Cape Town, South
Africa on Friday 24 August 2018 at 11:15.

Please note that the registration
counter for purposes of registering
to vote at this meeting on Friday
24 August 2018 will close at 11:00.

Record date, attendance and voting
The record date for the meeting (being
the date used for the purpose of
determining which shareholders are
entitled to participate in and vote at
the meeting) is 17 August 2018.

Votes at the annual general meeting will
be taken by way of a poll and not on
a show of hands.

A shareholder entitled to attend and
vote at the meeting is entitled to
appoint a proxy to attend, participate
in and vote at the meeting in the place
of the shareholder. A proxy need not
be a shareholder of the company.

Before any person may attend or
participate in a shareholders’ meeting,
that person must present reasonably
satisfactory identification and the
person presiding at the meeting must
be reasonably satisfied that the right
of that person to participate and vote,
either as a shareholder or as a proxy
for a shareholder, has been reasonably
verified. Forms of identification include
valid identity documents, driver’s
licences and passports.

A form of proxy, which includes the
relevant instructions for its completion,
is attached for the use of holders of
certificated shares and ’own name’
dematerialised shareholders who wish

to be represented at the annual general
meeting. Completion of a form of proxy
will not preclude such a shareholder
from attending and voting (in preference
to that shareholder’s proxy) at the
annual general meeting.

Holders of dematerialised shares,
other than ’own name’ dematerialised
shareholders, who wish to vote at the
annual general meeting, must instruct
their central securities depository
participant (CSDP) or broker
accordingly in the manner and
cutoff time stipulated by their
CSDP or broker.

Holders of dematerialised shares,
other than ’own name’ dematerialised
shareholders, who wish to attend the
annual general meeting in person, need
to arrange the necessary authorisation
as soon as possible through their CSDP
or broker.

A shareholder may appoint a proxy
at any time. For practical purposes,
the form appointing a proxy and the
authority (if any) under which it is signed,
must reach the transfer secretaries of
the company (Link Market Services
South Africa Proprietary Limited, 13th
floor, Rennie House, 19 Ameshoff
Street, Braamfontein 2001 or PO Box
4844, Johannesburg 2000) by no later
than 11:15 on Wednesday 22 August
2018 to allow for processing of such
proxy. Should you hold Naspers
A ordinary shares, the signed proxy
must reach the registered office of the
company by no later than 11:15 on
Wednesday 22 August 2018 to allow
for processing of such proxy. A form
of proxy is enclosed with this notice.
The form of proxy may also be
obtained from the registered office of
the company. All other proxies must be
handed to the company secretary prior
to the commencement of the meeting.

Purpose of meeting
The purpose of the meeting is: (i) to
present the directors’ report and the

audited annual financial statements of
the company for the immediate preceding
financial year, an audit committee
report and the social and ethics
committee report; (ii) to consider and,
if approved, to adopt with or without
amendment, the resolutions set out
below; and (iii) to consider any matters
raised by the shareholders of the
company, with or without advance
notice to the company.

Electronic participation
Shareholders entitled to attend and
vote at the meeting or proxies of
such shareholders shall be entitled to
participate in the meeting (but not vote)
by electronic communication. Should a
shareholder wish to participate in the
meeting by electronic communication,
the shareholder concerned should advise
the company thereof by no later than
09:00 on Friday 17 August 2018 by
submitting via registered mail addressed
to the company (for the attention of Mrs
Gillian Kisbey-Green) relevant contact
details, as well as full details of the
shareholder’s title to securities issued by
the company and proof of identity, in the
form of certified copies of identity
documents and share certificates (in the
case of materialised shares) and (in the
case of dematerialised shares) written
confirmation from the shareholder’s
CSDP, confirming the shareholder’s title
to the dematerialised shares. Upon
receipt of the required information, the
shareholder concerned will be provided
with a secure code and instructions to
access the electronic communication
during the annual general meeting.
Shareholders must note that access to
the electronic communication will be at
the expense of the shareholders who
wish to utilise the facility.

Integrated annual report
The integrated annual report of the
company for the year ended 31 March
2018 is available on www.naspers.com
or on request during normal business
hours at Naspers’s registered address,
40 Heerengracht, Cape Town 8000

(contact person Ms Yasmin Abrahams)
and in Johannesburg at MultiChoice
City, 144 Bram Fischer Drive, Randburg
2194 (contact person Mrs Toni Lutz).

undertake the audit) for the period
until the next annual general
meeting of the company.

4. To approve the appointment of

Ordinary resolutions
In order for the ordinary resolutions
below to be adopted, the support
of a majority of votes exercised by
shareholders present or represented
by proxy at this meeting is required.
Ordinary resolution number 10
requires the support of at least 75%
of the total number of votes exercised
by the shareholders present or
represented by proxy at this meeting.

1. To consider and accept the financial
statements of the company and the
group for the twelve (12) months
ended 31 March 2018 and the
reports of the directors, the auditor
and the audit committee. The
summarised form of the financial
statements is attached to this notice.
A copy of the complete annual
financial statements of the company
for the financial year ended
31 March 2018 can be obtained
from www.naspers.com or on
request during normal business
hours at Naspers’s registered
address, 40 Heerengracht, Cape
Town 8000 (contact person
Ms Yasmin Abrahams) and in
Johannesburg at MultiChoice City,
144 Bram Fischer Drive, Randburg
2194 (contact person Mrs Toni Lutz).

2. To confirm and approve payment
of dividends in relation to the N
ordinary and A ordinary shares of
the company as authorised by the
board after having applied the
solvency and liquidity tests
contemplated in the Act.

3. To reappoint, on the

recommendation of the company’s
audit committee, the firm
PricewaterhouseCoopers Inc. as
independent registered auditor
of the company (noting that Mr B
Deegan is the individual registered
auditor of that firm who will

Mr M R Sorour as non-executive
director with effect from 1 April
2018. His abridged curriculum vitae
appears on page 60 of the
integrated annual report. The board
unanimously recommends the
approval of the appointment of the
director in question.

5. To elect Messrs C L Enenstein,

D G Eriksson, H J du Toit, G Liu and
R Oliveira de Lima, who retire by
rotation and, being eligible, offer
themselves for re-election as
directors of the company. Their
abridged curricula vitae appear on
pages 59 and 60 of the integrated
annual report.
The board unanimously recommends
that the re-election of directors in
terms of resolution number 5 be
approved by the shareholders of
the company.
The appointment of the director in
ordinary resolution number 4 and
the re-election of directors in
ordinary resolution number 5 will be
conducted as a series of votes, each
being for the candidacy of a single
individual to fill a single vacancy, and
in each vote to fill a vacancy, each
voting right entitled to be exercised,
may be exercised once.

6. To appoint the audit committee

members as required in terms of the
Act and as recommended by the
King IV™ Report for Corporate
Governance for South Africa 2016
(King IV™) (principle 8).
The board and the nomination
committee are satisfied that the
company’s audit committee
members are suitably skilled and
experienced independent
non-executive directors. Collectively
they have sufficient qualifications and
experience to fulfil their duties, as
contemplated in regulation 42 of the
Companies Regulations 2011.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018112

Notice of annual general meeting
continued

Collectively, they have a
comprehensive understanding of
financial reporting, internal financial
controls, risk management and
governance processes within the
company, as well as International
Financial Reporting Standards (IFRS)
and other regulations and guidelines
applicable to the company. They
keep up to date with developments
affecting their required skillset.
The board and the nomination
committee therefore unanimously
recommend Messrs D G Eriksson
and B J van der Ross, and
Prof R C C Jafta for election to the
audit committee. Their abridged
curricula vitae appear on pages 59
and 60 of the integrated annual
report. The appointment of the
members of the audit committee
will be conducted by way of a
separate vote in respect of
each individual.

7. To endorse the company’s

remuneration policy, as set out
in the remuneration report in
the integrated annual report on
pages 68 to 91, by way of
a non-binding advisory vote.

8. To approve the implementation of
the remuneration policy as set out
in the remuneration report in the
integrated annual report on pages
68 to 91, by way of a non-binding
advisory vote.

9. To place the authorised but unissued
share capital of the company under
the control of the directors and to
grant, until the conclusion of the next
annual general meeting of the
company, an unconditional authority
to the directors to allot and issue at
their discretion (but subject to the
provisions of the Act and the JSE
Listings Requirements and the rules
of any other exchange on which
the shares of the company may
be quoted or listed from time to
time, and the memorandum of
incorporation of the company), the
unissued shares of the company, on
such terms and conditions and to

such persons, whether they be
shareholders or not, as the directors
in their discretion deem fit.

10. Subject to a minimum of 75% of the
votes of shareholders of the company
present in person or by proxy at the
annual general meeting and entitled
to vote, voting in favour thereof, the
directors be authorised and are
hereby authorised to issue unissued
shares of a class of shares already in
issue in the capital of the company
for cash as and when the opportunity
arises, subject to the requirements
of the JSE Limited (the JSE), including
the following:
• This authority shall not endure
beyond the earlier of the next
annual general meeting of the
company or beyond fifteen
(15) months from the date of this
meeting.

• That a paid press announcement
giving full details, including the
intended use of the funds, will be
published at the time of any issue
representing, on a cumulative
basis within one year, 5% or more
of the number of shares of that
class in issue prior to the issue.

• The aggregate issue of any

particular class of shares in any
financial year will not exceed
5% (21 932 802) of the issued
number of that class of shares
(including securities that are
convertible into shares of that
class).

• That in determining the price at
which an issue of shares will be
made in terms of this authority,
the discount at which the shares
may be issued may not exceed
10% of the weighted average
traded price of the shares in
question, as determined over the
thirty (30) business days prior to
the date that the price of the issue
is determined.

• That the shares will only be issued

to ‘public shareholders’ as defined
in the JSE Listings Requirements,
and not to related parties.

Special resolutions
The special resolutions set out on the following pages require the support of at
least 75% of votes exercised by shareholders present or represented by proxy
at this meeting in order to be adopted.

Special resolutions numbers 1.1 to 1.13
The approval of the remuneration of the non-executive directors for the year ending
31 March 2020 (up to 5% increase on fees (excluding value-added tax (VAT)) for
31 March 2019 already approved by shareholders at the annual general meeting
on 25 August 2017), as follows:

Board

1.1

1.2

Chair*

Member

31 March 2020
(proposed up to 5%
increase year on year
(excluding VAT))

2.5 times member

US$199 330

All members: Daily fees when travelling to and
attending meetings outside home country

US$3 500

Committees

Audit committee: Chair

Member

Risk committee: Chair

Member

Human resources and
remuneration committee: Chair

2.5 times member

US$49 110

2.5 times member

US$29 170

2.5 times member

Member

US$34 510

Nomination committee: Chair

2.5 times member

Member

US$18 600

Social and ethics committee: Chair

2.5 times member

Member

US$25 530

Other

Trustee of group share schemes/other
personnel funds

R53 760

1.3

1.4

1.5

1.6

1.7

1.8

1.9

1.10

1.11

1.12

1.13

Note
* The chair of Naspers does not receive additional remuneration for attending meetings, or being a member

of or chairing any committee of the board.

The reason for and effect of special
resolutions numbers 1.1 to 1.13 is to
grant the company the authority to pay
remuneration to its directors for their
services as directors.

Each of the special resolutions numbers
1.1 to 1.13 in respect of the proposed
31 March 2020 remuneration, will be
considered by way of a separate vote.

Special resolution number 2
That the board may authorise the
company to generally provide any
financial assistance in the manner
contemplated in and subject to the
provisions of section 44 of the Act to
a director or prescribed officer of the
company or of a related or interrelated
company, subject to (ii) below, or to
a related or interrelated company
or corporation, or to a member of
a related or interrelated corporation,
pursuant to the authority hereby
conferred upon the board for these
purposes. This authority shall (i) include
and also apply to the granting of
financial assistance to the Naspers share
incentive scheme, the other existing
group share-based incentive schemes
(details of which appear in the
integrated annual report) and such
group share-based incentive schemes
that are established in future
(collectively the Naspers group
share-based incentive schemes) and
participants thereunder (which may
include directors, future directors,
prescribed officers and future
prescribed officers of the company or
of a related or interrelated company)
(participants) for the purpose of, or in
connection with, the subscription of any
option, or any securities, issued or to be
issued by the company or a related or
interrelated company, or for the
purchase of any securities of the
company or a related or interrelated
company, pursuant to the
administration and implementation of
the Naspers group share-based
incentive schemes, in each instance on
the terms applicable to the Naspers

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018

113

Notice of annual general meeting
continued

group share-based incentive scheme
in question (ii) be limited, in respect
of directors and prescribed officers,
to financial assistance in relation to
the acquisition of securities as
contemplated in (i).

The reason for and effect of special
resolution number 2 is to approve
generally the provision of financial
assistance to the potential recipients
as set out in the resolution.

Special resolution number 3
That the company, as authorised by the
board, may generally provide, in terms
of and subject to the requirements of
section 45 of the Act, any direct or
indirect financial assistance to a related
or interrelated company or corporation,
or to a member of a related or
interrelated corporation, pursuant to
the authority hereby conferred upon
the board for these purposes.

The reason for and effect of special
resolution number 3 is to approve
generally the provision of financial
assistance to the potential recipients
as set out in the resolution.

Special resolution number 4
That the company or any of its subsidiaries
be and are hereby authorised to
acquire N ordinary shares issued by the
company from any person whosoever
(including any director or prescribed
officer of the company or any person
related to any director or prescribed
officer of the company), in terms of
and subject to the Act and in terms of
the rules and requirements of the JSE,
being that:

• Any such acquisition of N ordinary
shares shall be effected through the
order book operated by the JSE
trading system and done without any
prior understanding or arrangement.
• This general authority shall be valid
until the company’s next annual
general meeting, provided that it shall
not extend beyond fifteen (15)

months from the date of passing of
this special resolution.

• An announcement will be published
as soon as the company or any of its
subsidiaries have acquired N ordinary
shares constituting, on a cumulative
basis, 3% of the number of N
ordinary shares in issue prior to the
acquisition, pursuant to which the
aforesaid 3% threshold is reached,
and for each 3% in aggregate
acquired thereafter, containing full
details of such acquisitions.

• Acquisitions of N ordinary shares
in aggregate in any one financial
year may not exceed 20% of the
company’s N ordinary issued share
capital as at the date of passing of this
special resolution.

• In determining the price at which
N ordinary shares issued by the
company are acquired by it or any of
its subsidiaries in terms of this general
authority, the maximum premium at
which such N ordinary shares may be
acquired, will not exceed 10% of the
weighted average of the market value
at which such N ordinary shares are
traded on the JSE as determined over
the five (5) business days immediately
preceding the date of repurchase of
such N ordinary shares by the
company or any of its subsidiaries.
• At any point the company may only
appoint one agent to effect any
repurchase on the company’s behalf.
• The company and/or its subsidiaries
may not repurchase any N ordinary
shares during a prohibited period
as defined by the JSE Listings
Requirements, unless a repurchase
programme is in place where
dates and quantities of shares to be
traded during the prohibited period
are fixed, and full details of the
programme have been submitted
to the JSE in writing prior to the
commencement of the
prohibited period.

• Authorisation for the repurchase is

given by the company’s memorandum
of incorporation.

A resolution has been passed by the
board authorising the repurchase, and
confirming that the company and its
subsidiaries passed the solvency and
liquidity test and that from the time
that the test was done there have been
no material changes to the financial
position of the group. Before the
general repurchase is effected, the
directors, having considered the effects
of the repurchase of the maximum
number of N ordinary shares in terms
of the foregoing general authority, will
ensure that for a period of twelve (12)
months after the date of the notice of
the annual general meeting:

• The company and the group will
be able, in the ordinary course of
business, to pay their debts.

• The assets of the company and the
group, fairly valued in accordance
with IFRS, will exceed the liabilities of
the company and the group.
• The company and the group’s

ordinary share capital, reserves and
working capital will be adequate for
ordinary business purposes.

Additional information in respect of the
following appears in the integrated
annual report and in the annual financial
statements, and is provided in terms
of the JSE Listings Requirements for
purposes of the general authority:

• Major shareholders.
• Share capital of the company.

Directors’ responsibility statement
The directors, whose names appear in
the list of directors contained in the
integrated annual report, collectively
and individually accept full responsibility
for the accuracy of the information
pertaining to this special resolution
number 4 and certify that, to the best of
their knowledge and belief, there are no
facts that have been omitted that would
make any statement false or misleading,
and that all reasonable enquiries to
ascertain such facts have been made

and that special resolution number 4
contains all relevant information.

Ordinary resolution
11. Each of the directors of the

company or the company secretary
is hereby authorised to do all
things, perform all acts and sign all
documentation necessary to effect
the implementation of the ordinary
and special resolutions adopted
at this annual general meeting.

Other business
To transact such other business
as may be transacted at an annual
general meeting.

By order of the board

G Kisbey-Green
Company secretary

20 July 2018

Cape Town

Material changes
Other than the facts and developments
reported on in the integrated annual
report and annual financial statements,
except for the purposes of the group’s
share-based incentive schemes, there
have been no material changes in the
affairs or financial position of the
company and its subsidiaries since the
date of signature of the audit report
and up to the date of this notice.

Other than repurchasing N ordinary
shares for purposes of the group’s
share-based incentive schemes, the
directors have no specific intention, at
present, for the company to repurchase
any of its N ordinary shares, but believe
that such a general authority should be
put in place in case an opportunity
presents itself during the year, which
is in the best interest of the company
and its shareholders.

The reason for and effect of special
resolution number 4 is to grant the
company the authority in terms of the
Act and the JSE Listings Requirements
for the acquisition by the company,
or a subsidiary of the company, of the
company’s N ordinary shares.

Special resolution number 5
That the company or any of its
subsidiaries be and are hereby
authorised to acquire A ordinary shares
issued by the company from any person
whosoever (including any director or
prescribed officer of the company or
any person related to any director or
prescribed officer of the company), in
terms of and subject to the Act.

The reason for and effect of special
resolution number 5 is to grant the
company the authority in terms of the
Act for the acquisition by the company,
or a subsidiary of the company, of the
company’s A ordinary shares.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018114

Form of proxy

Naspers Limited
Incorporated in the Republic of South Africa
Registration number: 1925/001431/06
ISIN: ZAE000015889 LSE share code: NPSN
(the company)

JSE share code: NPN

ISIN: US 6315122092

104th annual general meeting of shareholders
For use by holders of certificated shares or ’own name’ dematerialised shareholders at the 104th annual general meeting
of shareholders of the company to be held on the 2nd floor, Daisy Room, Cape Town International Convention Centre 2
(CTICC2), corner of Heerengracht and Rua Bartholomeu Dias, Foreshore, Cape Town, South Africa on Friday
24 August 2018 at 11:15.

I/We (please print)

being a holder of

’own name’ dematerialised
shares of Naspers and entitled
to (see note 1)

certificated
shares or

votes,
hereby
appoint

or, failing him/her,

the chair of the annual general meeting as my/our proxy to act for me/us at the annual general meeting,
which will be held on the 2nd floor, Daisy Room, Cape Town International Convention Centre 2 (CTICC2),
corner of Heerengracht and Rua Bartholomeu Dias, Foreshore, Cape Town, South Africa on Friday 24 August
2018 at 11:15 for the purpose of considering and, if deemed fit, passing, with or without modification, the
resolutions to be proposed thereat and at each adjournment or postponement thereof, and to vote for or
against the resolutions and/or abstain from voting in respect of the shares in the issued share capital of the
company registered in my/our name(s) (see note 2) as follows:

In favour of

Against

Abstain

Ordinary resolutions

Acceptance of annual financial statements

Confirmation and approval of payment of dividends

Reappointment of PricewaterhouseCoopers Inc. as auditor

To confirm the appointment of M R Sorour as a non-
executive director

To elect the following directors:

5.1

5.2

C L Enenstein

D G Eriksson

In favour of

Against

Abstain

5.3

5.4

5.5

6.1

6.2

6.3

10.

11.

H J du Toit

G Liu

R Oliveira de Lima

Appointment of the following audit committee members:

D G Eriksson

B J van der Ross

R C C Jafta

To endorse the company’s remuneration policy

To approve the implementation of the remuneration policy
as set out in the remuneration report

Approval of general authority placing unissued shares under
the control of the directors

Approval of general issue of shares for cash

Authorisation to implement all resolutions adopted at the
annual general meeting

or, failing him/her,

Special resolution number 1

Approval of the remuneration of the non-executive directors

Proposed financial year 31 March 2020:

1.1

1.2

1.3

1.4

1.5

1.6

1.7

1.8

1.9

Board – chair

Board – member

Audit committee – chair

Audit committee – member

Risk committee – chair

Risk committee – member

Human resources and remuneration committee – chair

Human resources and remuneration committee – member

Nomination committee – chair

1.10 Nomination committee – member

1.11

1.12

1.13

Social and ethics committee – chair

Social and ethics committee – member

Trustees of group share schemes/other personnel funds

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018
Form of proxy
continued

Special resolution number 2

Approve generally the provision of financial assistance in terms of
section 44 of the Act

Special resolution number 3

Approve generally the provision of financial assistance in terms of
section 45 of the Act

Special resolution number 4

General authority for the company or its subsidiaries to acquire
N ordinary shares in the company

Special resolution number 5

General authority for the company or its subsidiaries to acquire
A ordinary shares in the company

and generally to act as my/our proxy at the said annual general meeting (tick whichever is applicable).

The shareholder must provide direction to his/her proxyholder (unless the proxy is provided to the chair); failure to so
comply will be deemed to authorise the chair to vote in favour of the resolutions.

Signed at……………………………………………. on this …………. day of …………………………….………..2018

Signature………………………………… Assisted (where applicable) ………………………………….……….………

115

In favour of

Against

Abstain

Notes to form of proxy
1. The following provisions shall apply in relation to proxies:

1.1 A shareholder of the company may appoint any individual (including an individual who is not a shareholder
of the company) as a proxy to participate in, speak and vote at the annual general meeting of the company.
1.2 A shareholder may appoint two or more persons concurrently as proxies and may appoint more than one

proxy to exercise voting rights attached to different securities held by the shareholder.

1.3 A proxy instrument must be in writing, dated and signed by the shareholder.
1.4 A proxy may not delegate the proxy’s authority to act on behalf of the shareholder to another person, other

than to the chair.

1.5 A copy of the instrument appointing a proxy must be delivered to the company, or to any other person on

behalf of the company, before the proxy exercises any rights of the shareholder at the annual general meeting.

1.6 Irrespective of the form of instrument used to appoint the proxy: (i) the appointment is suspended at any time
and to the extent that the shareholder chooses to act directly and in person in the exercise of any rights as a
shareholder; (ii) the appointment is revocable unless the proxy appointment expressly states otherwise; and (iii)
if the appointment is revocable, a shareholder may revoke the proxy appointment by cancelling it in writing or
making a later inconsistent appointment of a proxy and delivering a copy of the revocation instrument to the
proxy and the company.

1.7 The proxy is not entitled to exercise, or abstain from exercising, any voting right of the shareholder without

direction.

2. A certificated or ’own name’ dematerialised shareholder may insert the names of two alternative proxies of the

shareholder’s choice in the space provided, deleting “the chair of the annual general meeting”. The person whose
name appears first on the form of proxy and whose name has not been deleted and who attends the meeting,
will be entitled and authorised to act as proxy to the exclusion of those whose names follow.

3. A shareholder’s instructions to the proxy must be indicated by that shareholder in the appropriate space provided,
failing which the proxy shall not be entitled to vote at the annual general meeting in respect of the shareholder’s
votes exercisable at that meeting, provided where the proxy is the chair, failure to so comply will be deemed to
authorise the chair to vote in favour of the resolutions.

4. A shareholder may appoint a proxy at any time. For practical purposes, forms of proxy for Naspers N ordinary

shares must be lodged at or posted to the transfer secretaries of the company, Link Market Services South Africa
Proprietary Limited, 13th floor, Rennie House, 19 Ameshoff Street, Braamfontein 2001 or PO Box 4844,
Johannesburg 2000. Forms of proxy for Naspers A ordinary shares must be lodged at or posted to the registered
office of the company, 40 Heerengracht, Cape Town 8001 or PO Box 2271, Cape Town 8000. Forms of proxy
lodged in this manner are to be received by not later than 11:15 on Wednesday 22 August 2018, or such later date
if the annual general meeting is postponed to allow for processing of such proxies. All other proxies must be handed
to the company secretary prior to the commencement of the meeting.

5. The completion and lodging of this form of proxy will not preclude the certificated shareholder or ’own name’
dematerialised shareholder from attending the annual general meeting and speaking and voting in person at the
meeting to the exclusion of any proxy appointed in terms hereof.

6. An instrument of proxy shall be valid for any adjournment or postponement of the annual general meeting, as well

as for the meeting to which it relates, unless the contrary is stated therein, but shall not be used at the resumption of
an adjourned annual general meeting if it could not have been used at the annual general meeting from which it was
adjourned for any reason other than that it was not lodged timeously for the meeting from which the adjournment
took place.

IntroductionGroup overviewThe Naspers approachBusiness overviewPerformance reviewGovernanceFinancial statementsFurther informationNaspers integrated annual report 2018
116

Form of proxy
continued

7. A vote cast or act done in accordance with the terms of a form of proxy shall be deemed to be valid despite:

• the death, insanity, or any other legal disability of the person appointing the proxy, or
• the revocation of the proxy, or
• the transfer of a share in respect of which the proxy was given, unless notice as to any of the above-mentioned
matters shall have been received by the company at its registered office or by the chair of the annual general
meeting at the place of the annual general meeting, if not held at the registered office, before the commencement or
resumption (if adjourned) of the annual general meeting at which the vote was cast or the act was done or before
the poll on which the vote was cast.

8. The authority of a person signing the form of proxy:

8.1 under a power of attorney, or
8.2 on behalf of a company or close corporation or trust, must be attached to the form of proxy unless the full

power of attorney has already been received by the company or the transfer secretaries.

9. Where shares are held jointly, all joint holders must sign.
10. Dematerialised shareholders, other than by ’own name’ registration, must NOT complete this form of proxy and
must provide their central securities depository participant (CSDP) or broker of their voting instructions in terms
of the custody agreement entered into between such shareholders and their CSDP and/or broker.

Shareholder and corporate information

Administration and corporate information
Company secretary
Gillian Kisbey-Green
MultiChoice City
144 Bram Fischer Drive
Randburg 2194
South Africa
Companysecretariat@naspers.com
Tel: +27 (0)11 289 3032

ADR programme
Bank of New York Mellon maintains a Global
BuyDIRECTSM plan for Naspers Limited.

For additional information, visit Bank of New York Mellon’s
website at www.globalbuydirect.com or call Shareholder
Relations at 1-888-BNY-ADRS or 1-800-345-1612 or
write to:

Registered office
40 Heerengracht
Cape Town 8001
South Africa
PO Box 2271
Cape Town 8000
South Africa
Tel: +27 (0)21 406 2121
Fax: +27 (0)21 406 3753

Registration number
1925/001431/06
Incorporated in South Africa

Auditor
PricewaterhouseCoopers Inc.

Transfer secretaries
Link Market Services South Africa Proprietary Limited
(Registration number: 2000/007239/07)
PO Box 4844
Johannesburg 2000
South Africa
Tel: +27 (0)11 630 0800
Fax: +27 (0)11 834 4398

Bank of New York Mellon
Shareholder Relations Department –
Global BuyDIRECTSM
Church Street Station
PO Box 11258, New York, NY 10286-1258
USA

Sponsor
Investec Bank Limited
(Registration number: 1969/004763/06)
PO Box 785700, Sandton 2146
South Africa
Tel: +27 (0)11 286 7326
Fax: +27 (0)11 286 9986

Attorneys
Werksmans Inc.
PO Box 1474
Cape Town 8000
South Africa
Webber Wentzel (in alliance with Linklaters)
PO Box 61771
Marshalltown
Johannesburg 2107
South Africa

Investor relations
Meloy Horn
InvestorRelations@naspers.com
Tel: +27 (0)11 289 3320
Fax: +27 (0)11 289 3026

Number of
shareholders

Number of
N ordinary shares owned

Volume

Price

PRICE AND VOLUME

Analysis of N ordinary shareholders

Size of holdings

1 – 100 shares

101 – 1 000 shares

1 001 – 5 000 shares

5 001 – 10 000 shares

More than 10 000 shares

59 299

23 707

3 243

678

1 460

88 387

GEOGRAPHIC SPREAD

SHAREHOLDER TYPES

2 025 926

R4 500.00

7 291 763

7 011 763

R4 000.00

4 824 245

R3 500.00

417 502 362

438 656 059

E
C
R
P

R3 000.00

R2 500.00

R2 000.00

7
1
r
a
M
Volume

7
1
r
p
A

7
1
y
a
M

Price

7
1
n
u

7
1

7
1
g
u
A

7
1
p
e
S

7
1
t
c
O

7
1
v
o
N

7
1
c
e
D

8
1
n
a

8
1
b
e
F

8
1
r
a
M

The following shareholders hold 5% or more of the N ordinary issued share capital of the company:

117

Shareholders’ diary

Annual general meeting

August

Reports

Interim for half-year to September

November

Announcement of annual results

Annual financial statements

June

July

Dividend

Declaration

Payment

Financial year-end

August

September

March

V
O
L
U
M
E
(

)

SOUTH AFRICA

EUROPE (excluding UK)

NORTH AMERICA

ASIA

REST OF THE WORLD

OTHER

41.54

12.94

5.71

30.07

6.36

1.26

2.12

FOREIGN INSTITUTIONS

53.01

DOMESTIC INSTITUTIONS

30.09
PRIVATE STAKEHOLDERS/INVESTORS 5.57
DOMESTIC BROKERS

3.08

EMPLOYEES, ETCETERA

OTHER

2.74

5.51

Name

% of
N ordinary
shares held

Number of
N ordinary
shares owned

Public Investment Corporation of South Africa

13.72

60 201 787

Public shareholder spread (N ordinary shares)
To the best knowledge of the directors, the spread of public shareholders in terms of section 4.25 of the
JSE Listings Requirements at 31 March 2018 was 97.01%, represented by 88 376 shareholders holding
425 576 963 N ordinary shares in the company. The non-public shareholders of the company comprising
11 shareholders representing 13 079 096 N ordinary shares are analysed as follows: