Improving
everyday life
for billions of
people through
technology
Integrated
annual report
3
2
0
2
Supporting documents that inform our reporting suite for 2023
• Boundaries and scope of our greenhouse gas accounting
•
Independent auditor’s limited assurance report on the selected sustainability
information in the Naspers Limited integrated annual report
• King IVTM application report
To access these supporting documents, refer to www.naspers.com.
40 Heerengracht
Cape Town
8001
South Africa
www.naspers.com
Naspers is a global
consumer internet group and
one of the largest technology
investors in the world.
Contents
2
Group overview
74
Sustainability review
4
6
10
12
14
16
20
26
32
34
36
40
44
Snapshot FY23
Group overview
Segment overview
Chair’s review
Our board
Chief executive’s review
Chief financial officer’s review
Engaging with our stakeholders
Our strategy
How we create value – our business
model
The world in which we operate
Choosing the right opportunities and
balancing risks
Path to profitability
46
Performance review
47
Operational performance
48 Food Delivery
52 Classifieds
54 Payments and Fintech
58 Edtech
62 Etail
68 Other ecommerce: Ventures
70 Social and internet platforms
72 Media24
Our approach
People
Digital inclusion
Innovation
Artificial intelligence
Cyber-resilience
Data privacy
Business culture, ethics and integrity
Upholding human rights
Community investment
76
78
82
82
86
89
92
95
97
98
100 Managing our environmental impact
110
Tax
114 Governance
The board and its committees
116 Group structure
118 Overview of governance
122
129 Audit committee
132 Risk committee
133
134 Nominations committee
135 Human resources and remuneration
Social, ethics and sustainability committee
committee
136 Remuneration report
138 Background and policy
146 Implementation of
remuneration policy
165 Additional information
167 About this report
170 Summary financial statements
214 Other information
Independent auditor’s report
Summary consolidated financial statements
174
175
181 Notes to the summary consolidated financial
statements
206 Other information to the summary
consolidated financial statements
212 Report on the assurance engagement
on the compilation of pro forma financial
information
216 Administration and corporate information
217 Analysis of shareholders and
shareholders’ diary
218 Glossary
Navigation icons
Material matters
For more information
in this report
For more information
available online
Financial
performance
Responsible
investments
People
Digital
Innovation
Cyber-resilience
Business culture,
ethics and integrity
Community
investment
AI
Data privacy
Climate action
Forward-looking statements
This report contains forward-looking statements as defined in the United States Private Securities Litigation Reform Act
of 1995 concerning our financial condition, results of operations and businesses. These forward-looking statements
are subject to a number of risks and uncertainties, many of which are beyond our control and all of which are based
on our current beliefs and expectations about future events. Forward-looking statements are typically identified by the
use of forward-looking terminology such as ‘believes’, ‘expects’, ‘may’, ‘will’, ‘could’, ‘should’, ‘intends’, ‘estimates’,
‘plans’, ‘assumes’ or ‘anticipates’, or associated negative, or other variations or comparable terminology, or by
discussions of strategy that involve risks and uncertainties. These forward-looking statements and other statements
contained in this report on matters that are not historical facts involve predictions.
No assurance can be given that such future results will be achieved. Actual events or results may differ materially as
a result of risks and uncertainties implied in such forward-looking statements.
A number of factors could affect our future operations and could cause those results to differ materially from those
expressed in the forward-looking statements, including (without limitation): (a) changes to IFRS and associated
interpretations, applications and practices as they apply to past, present and future periods; (b) ongoing and future
acquisitions, changes to domestic and international business and market conditions such as exchange rate and
interest rate movements; (c) changes in domestic and international regulatory and legislative environments;
(d) changes to domestic and international operational, social, economic and political conditions; (e) labour
disruptions and industrial action; and (f) the effects of both current and future litigation. The forward-looking
statements contained in this report apply only as of the date of the report. We are not under any obligation to
(and expressly disclaim any such obligation to) revise or update any forward-looking statements to reflect events or
circumstances after the date of the report or to reflect the occurrence of unanticipated events. We cannot give any
assurance that forward-looking statements will prove correct and investors are cautioned not to place undue reliance
on any forward-looking statements.
NASPERS
Integrated annual report 2023
NASPERS
Integrated annual report 2023
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Artificial
intelligence
Artificial intelligence and machine learning (AI and ML) are
rapidly becoming ubiquitous features of modern life.
Naspers offers
Highlights
2023
AI adoption globally is
2.5 times higher
in 2022 than in 2017
AI market size expected to reach
US$407bn
by 2027 (2022*: US$87m)
Projected annual growth
rate of
37.3%
from 2023 to 2030
Over
75%
of consumers are concerned
about companies using
AI – addressing these
apprehensions will be crucial
But
65%
of consumers say they’ll still
trust businesses that use AI –
companies using AI responsibly
and transparently can maintain
consumer confidence and
harness AI’s potential to improve
customer experiences
» AI is core to what we do and how we do it, and
we are determined to use it as widely and as
well as possible – making better and better
use of AI, to improve everyday life for billions of
people around the world.
» We ensure we develop and deploy AI as
quickly as possible to support business growth,
and innovate and improve our competitive
ability. And we seek to always do this in the
right way – by design, ethically and responsibly.
» Robust principles on how we develop and
deploy AI:
– Deploy AI everywhere it makes business
sense.
– Develop AI-by-design for innovation in
products and services.
– Develop and deploy AI ethically and
responsibly.
» Ahead of increased regulatory scrutiny, we have
formal policies on responsible and ethical use
of AI, data privacy and sharing, cybersecurity
and more.
» Across the group, we apply data science and AI
in numerous ways to add value for customers,
partners and the business, and to fulfil our
purpose: better product recommendation,
fraud prevention, content moderation, logistics
optimisation and more. We also use AI to
develop new products and concepts across our
segments, such as content creation and search
in Edtech.
» We engage with several data-science-for-social-
good initiatives, dedicated to adopting AI in
projects with a positive social impact.
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NASPERS
Integrated annual report 2023
* Estimated.
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Integrated annual report 2023
3
Snapshot FY23
A reduction in the holding
company discount
17 percentage points
Revenue2 from continuing
operations
US$33.2bn
» Repurchased US$2.5bn shares since
September 2022
» 16 320 371 N ordinary shares repurchased
» NAV per share accretion1 of 4.5%
» 20% growth on revenue from our
consolidated Ecommerce business
» Trading loss from our consolidated
Ecommerce business widened by US$111m
Support to those
impacted by the war in
Ukraine
Commitment to
profitability
» Renounced the group’s interest in VK
» Disposed of Avito on 14 October 2022
for RUB151bn (US$2.4bn) to Kismet
Capital Group
» We allocated US$4.5m to Tvoya Opora and
US$2.5m to the Kolo Charitable Foundation
to procure medical supplies and equipment
We developed our climate
targets by applying the
Science-based
Targets
initiative’s (SBTi)
guidance
» Implemented actions towards absolute
reductions of scope 1 and 2 emissions to
zero (for Prosus and Naspers corporate
entities). Improved GHG reporting by
including scope 3
» We developed group principles and
approaches to help our subsidiaries and
associates develop impactful packaging
strategies
» Commitment to deliver consolidated
Ecommerce trading profit during the first half
of FY25
Diversity and
inclusion training
cascaded to all group
companies
» Employee inclusivity is core to our success as
a business
1 NAV per-share accretion includes all per-share enhancing actions: the Prosus repurchase programme and Naspers purchase programme initiated in FY21, the
voluntary share exchange programme executed in FY22, the Prosus share repurchase initiated in FY22 and open-ended share repurchase programme initiated
in FY23.
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Integrated annual report 2023
Total taxes paid
US$1.2bn
» Direct taxes levied: US$820m and indirect
taxes collected: US$415m
» Naspers’ approach to tax centres around
paying taxes in the countries where we
operate
Naspers Labs, in
collaboration with extensive
networks, has placed
3 920 young people in
tech and tech-enabled jobs
» Human rights statement reinforced with all
our group companies
Cost-saving
initiatives
» Reduction in corporate workforce by 30%
and broader action to reduce other
significant costs
>500 data scientists
now part of the Naspers
AI community
Strong financial performance
Revenue2 (US$’m)
35 056
33 237
29 586
2021
2022
2023
Trading profit2 (US$’m)
5 576
4 904
3 348
2021
2022
2023
2 Presented on an economic-
interest basis from continuing
operations.
NASPERS
Integrated annual report 2023
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Group overview
Who we are
We are a global consumer internet group operating across
platforms and geographies, and one of the largest technology
investors in the world.
As a group, we build useful products for over two billion customers and help their communities thrive. We empower our
teams to develop their skills and build meaningful careers. We create long-term value for our shareholders and our many
other stakeholders.
Strong position
Proven core
businesses
Our core businesses in
Food Delivery, Payments
and Fintech, Classifieds
and Media recorded profits
of US$144m in FY23,
improving from US$112m
in FY22
Catalysts for
value creation
Accelerate Ecommerce
profitability; continue
open-ended share
repurchase; expect strong
recovery from Tencent;
simplify group structure;
build a repeatable process
of investing towards
crystallisation and return
Solid
financial position
Net cash and excellent
liquidity are strategic
advantages in the current
environment
Our purpose
Improving everyday life for billions of people through technology
What we do
We build leading companies that empower people and enrich
communities
We bring food
and more to
people’s doors
and more
customers to
restaurants’
kitchens.
We put the power
to make fast,
secure payments
in people’s hands
and give them
credit options too,
often for the first
time.
We enable people
and businesses
to buy and
sell quickly,
conveniently
and safely
and boost the
circular economy
by giving items
multiple lives.
We open up
a world of
learning,
helping millions
of people learn
where, when and
how they want.
6
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Integrated annual report 2023
Our values
Our values underpin our culture, which guides our actions
We build
At heart, we’re entrepreneurs.
We back local entrepreneurs and teams and we operate and invest in businesses in many of the most exciting
markets in the world. Our focus on sustainable long-term value creation means our group is a great place for
people to build their careers. We work hard to connect, learn and grow to be the best we can be.
We deliver
We push for excellence in everything we do.
We move fast, adapting quickly to seize opportunities. We agree on clear and ambitious goals, and regularly
discuss how to beat them. Our reward is hardwired to performance, and depends on what we deliver and how
we deliver it.
We’re responsible
We matter to our customers and communities.
We strive to maximise our positive impact on society and the planet. Wherever we operate, we hold ourselves
to the highest standards, set out in our code of business ethics and conduct. We’re all responsible for the
impact we deliver.
We value each other
We believe diversity in our teams and in our thinking delivers better outcomes for all.
We create supportive and flexible environments so we can perform at our best. We’re empowered to make
decisions about our work because we’re trusted to do a great job.
We estimate that around one fifth of the world’s
population uses products and services of businesses that
we have built, acquired or invested in. Many use the products
and services of more than one.
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NASPERS
Integrated annual report 2023
7
Group overview continued
What sets us apart
We think global and act local
» Focus on emerging large consumer trends linked to disruptive innovation – we identify changes
early, invest in and adapt proven business models for the high-growth markets we focus on.
» Leverage our skills, local knowledge and position to build businesses that are scalable and benefit
from local network effects.
» By operating locally, we benefit from the insights of our local operations and their markets. We gain
early views on emerging models and are therefore better positioned to drive organic and inorganic
growth and support entrepreneurial, seasoned business leaders.
» We believe our platforms offer customers fast, intuitive and secure environments for communicating
and conducting transactions.
» Focus on markets that we believe present above-average growth opportunities given their economic
growth prospects, scalability and fast-growing, mobile internet penetration levels.
» We believe building strong global and local brands is an important way for our businesses to
differentiate themselves, driving organic growth through word of mouth while complying with the laws
and regulations of jurisdictions in these markets.
We are both an operator and an investor
» As operator, we are able to make smarter investment decisions.
» As investor, we support our businesses with the right combination of capital, market knowledge and
know-how to succeed. We benefit from access to attractive opportunities globally. We have long-
standing and successful relationships with prominent internet businesses in our largest markets.
» Concentrating on customers, thinking about their lives and how best to meet their needs is central to
what we do. Across our portfolio, we are building ecosystems with multiple customer touchpoints to
improve their experience and retain their loyalty. We align technology and data with key customer
needs such as convenience, ease of use, reliability and safety.
Track record
Food Delivery
PayU
Edtech
PayU
India
OLX
Track record
Food Delivery
Food Delivery
Food Delivery
Payments and
Fintech
Edtech
» Ours is a long-term business. It takes continued investment to build the end-to-end capabilities
supporting closer, stronger relationships with customers across the ecosystems of our core segments.
But, it delivers long-term gain – not least, customer loyalty and more lasting value creation.
Ecommerce
» The leaders of our businesses are compensated directly on the performance of their divisions,
fostering a strong culture of entrepreneurship in our group.
» We are disciplined, but not tied to a rigid investment regime, which enables us to take a long-term
view. This means we can support our businesses at every stage of their life cycle and focus on
creating value over the long term.
Ecommerce
Ecommerce
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NASPERS
Integrated annual report 2023
Growth opportunities
» Our consumer internet businesses have significant potential for growth.
» They offer opportunities for an enhanced range of internet transactions and services in our
markets, as well as possible expansions into new markets.
» We believe demand for our products and services will be driven by several trends, including
growth in:
– gross domestic
product (GDP)
– population growth
in the younger
demographics
and middle class
– continued growth in
mobile and high-
speed internet
penetration
– increasing adoption of new
internet-based business models
that are disrupting existing
traditional business models
across a range of industries.
Risks to growth opportunities
» Slowing economic growth with record inflation and rising interest rates. Interest rates increased sharply in the 2022
calendar year and continued to increase in 2023 as central banks reacted to high inflation rates, resulting in
deteriorating consumer sentiment and slowing economic growth.
» While macroeconomic drivers are the same across the world, there is wide variation in how significant economies have
been performing.
» Regulation is increasing. Broad technological advancements pose significant challenges for regulators who strive to
maintain a balance between fostering innovation, protecting consumers, and addressing the unintended consequences
of digital disruption at scale.
» Global ventures investment plummeted in 2022 to the levels of 2017. However, in contrast to panic-selling at the onset of
the pandemic in 2020, the sell-off in 2022 was orderly, with relatively lower volatility. Further downside is possible.
» Escalating geopolitical tensions could seriously impact markets. Geopolitical tension has caused stress on the global
economy and capital markets, significantly increasing the cost of capital.
» Climate change and its consequences have a significant impact on people’s lives. Rising occurrence of extreme weather
conditions, drought and flooding may impact on our customers, employees and our business.
» We have reduced cost and headcount. The impact of these necessary actions weighs on our staff. While we find new
ways of working and organising ourselves to be as efficient as we can be, the risk of unexpected operational issues and
reduced morale is currently heightened.
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Integrated annual report 2023
9
Segment overview
We focus on high-growth markets and business models that
we know well.
Food Delivery
Payments and Fintech
Etail
Social and internet platforms
Our portfolio of food-delivery businesses allows
customers to order their favourite food online and
via apps to be conveniently delivered wherever
they are.
Read more on page 48.
41.82%
14.29%
12.99%
Revenue1
US$4.2bn
up 40% (44%)
Trading loss1
US$649m
down 10% (12%)
Employees
5 210
Classifieds2
OLX serves hundreds of millions of people every
month across five continents, helping people buy
and sell cars, find housing, get jobs and buy and
sell household goods.
Read more on page 52.
PayU is an online payment services platform
that has processed more than US$78bn payment
volumes globally and is a payment gateway for
merchants in high-growth markets as well as large
international companies.
PayU operates on four continents, in 17 high-growth
markets and offers over 300 payment options.
Read more on page 54.
43.54%
43.54%
37.1%
43.54%
39.68%
9.33%
42.02%
Revenue1
US$1.1bn
up 32% (51%)
Trading loss1
US$116m
up 93% (72%)
Employees
3 447
43.10%
16.36%
Edtech
Revenue1
US$1.6bn
up 19% (42%)
Trading loss1
US$156m
up >100%
(>100%)
Employees
4 500
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Integrated annual report 2023
We reach 90% of Fortune 100 companies across
our corporate learning platforms. We also have a
strong presence in K–12 (kindergarten to grade 12)
in key markets.
Read more on page 58.
16.22%
43.54%
27.10%
Revenue1
US$545m
up 28% (18%)
Trading loss1
US$258m
up >100% (54%)
Employees
859
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eMAG is an ecommerce leader in Central and
Eastern Europe.
Prosus holds an investment in Tencent, China’s
largest and most-used internet services platform.
Read more on page 62.
Read more on page 70.
34.87%
100%
11.39%
Revenue1
US$2.8bn
down 11%
(0%)
Trading loss1
US$85m
up >100%
(>100%)
Employees
10 366
Revenue1
US$22.3bn
down 12% (1%)
Trading profit1
US$5.1bn
down 19% (9%)
Other ecommerce: Ventures
Media24
Includes our Ventures arm that partners with
entrepreneurs to build prominent technology
companies, aiming to fuel the next wave of growth
for the group.
Media24 is one of Africa’s leading print and digital
media groups with interests in digital media and
services, newspapers, magazines, ecommerce,
book publishing and media logistics.
Read more on page 68.
Read more on page 72.
9.90%
6.02%
4.01%
3.50%
4.70%
9.85%
4.90%
100%
Revenue1
US$217m
down 16% (0%)
Trading profit1
US$7m
down 59% (53%)
Employees
2 167
Revenue1
US$618m
up 62% (66%)
Trading loss1
US$270m
down 34%
(21%)
Employees
750
1 Presented on an economic-interest basis from continuing operations.
2 From 1 March 2023, following the group’s decision to exit the OLX Autos
business unit, its operations are classified as held for sale and those that
have been closed by 31 March 2023 were presented as a discontinued
operation. In May 2022, as a result of the continued conflict in the region,
the group announced its decision to exit its Russian business. Accordingly,
Avito was presented as a discontinued operation.
Our group includes some of
the best-loved local consumer
internet companies in around
100 countries, spanning the
Americas to Asia, Europe to
South Africa.
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NASPERS
Integrated annual report 2023
11
Chair’s review
We create long-term value for
our shareholders by improving
the everyday lives of billions of
people through technology.
Koos Bekker
Chair
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NASPERS
Integrated annual report 2023
Creating real value in a world of
change
As digitisation advances, a large part of our
lives is now lived online. New technological
breakthroughs are accelerating this transition,
which plays out against a backdrop of
geopolitical tensions, inflation and supply-
chain disruptions.
In the face of uncertainty, we tried to
maintain our focus and our purpose.
As a consumer internet group and one
of the largest technology investors, we
are helping to bring the benefits of a
digital world to our customers. We do
this in the core segments of Food
Delivery, Classifieds, Payments and
Fintech, and Edtech, where we aim
to build useful ecosystems.
Creating value for shareholders
In June 2022, the board approved an
open-ended repurchase programme of Prosus
and Naspers shares. The aim was to unlock
value for shareholders and increase net asset
value (NAV) per share over time. This implies
a programmatic trimming of Tencent shares
and will remain active while the discount to
NAV is at elevated levels. At the same time,
Tencent remains our most important asset and
we are convinced that it will grow further in
future.
Investors responded positively, acknowledging
the repurchase programme as a signal of
long-term commitment to unlocking value,
although some cautioned that this was not
the only solution to remedy discounts. Our
intention is to do more, including improving
profitability of Ecommerce. A major ambition
is to reach consolidated profitability in our
Ecommerce business during the first half of
FY25. We also wish to address some
complexities around the cross-holding
structure, if possible.
By year-end, the group NAV discount had
reduced by 17 percentage points, creating
over US$25bn of value for shareholders.
To fund the process, we realised US$10.7bn
from the sale of 3% of Tencent’s issued share
capital, reducing our stake to 26.16%.
Discount to net asset value progression since
implementing the repurchase programme
(%)
80
70
60
50
40
Apr 2022
Jun 2022
Sept 2022
Dec 2022
Mar 2023
●
Discount
In March 2023, we announced our exit of OLX Autos, an
adjacent operation to our successful core OLX classifieds
business. This strategic development is detailed by our
chief executive.
Dividend
The Prosus board has recommended that, in total, its
shareholders receive a distribution of a gross amount of
approximately €175m which represents an increase of
approximately 7% for free-float shareholders. Subject to the
requisite approval by Prosus shareholders being obtained, a
dividend will be paid by Naspers in relation to the Naspers N
ordinary shares and A ordinary shares from the amount that
Naspers receives from Prosus, in accordance with the rights
attaching to the shares as set out in the Naspers
memorandum of incorporation. The Naspers dividends will be
paid in South African rand. Given the weakening of the rand
against the euro, the expected year-on-year increase in the
dividends is higher than in the recent past. More information
regarding the dividend will be published in due course.
Looking ahead
Focus on sustainability
As outlined extensively in this report, our aim is to be
a sustainable business. We do this by investing in tech-driven
ventures in many countries, building them into enterprises that
support local job creation and prosperity. Sometimes these
services create more environmentally friendly alternatives to
traditional solutions. Many are also socially transformative.
During the new financial year we will undoubtedly face
challenges again. We will navigate these as best we can.
Hopefully, new opportunities may also appear along the way.
On behalf of the board, I thank everyone who contributed to
our results for the year. We look forward to continued growth
as a global consumer internet company dedicated to
improving people’s lives around the world.
Koos Bekker
Chair
26 June 2023
Doing the right things in the right way
Our values are reflected in our code of business ethics and
conduct. Our directors promote a culture of strong business
ethics aimed at long-term value creation. This underpins
the group’s activities as a responsible corporate citizen.
Governance of information and technology – particularly
data privacy and cybersecurity – remained focus areas.
We updated multiple key group policies, including the
sanctions and export controls policy.
In October 2022, Sharmistha Dubey, independent
non-executive director, was appointed as a member of the
audit committee, enhancing its composition.
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Integrated annual report 2023
13
Our board
Koos Bekker
70, male, South African and Dutch
Non-executive chair
P* H N
Date of first appointment: 17 April 2015
Date of last appointment: 25 August 2022
Area of expertise and contribution: M&A,
corporate finance, strategy, entrepreneur
Bob van Dijk
50, male, Dutch
Chief executive and executive
director
P R S
Date of first appointment: 1 April 2014
Date of last appointment: 29 August 2014
Area of expertise and contribution: M&A,
tech expertise, entrepreneur
Basil Sgourdos
53, male, South African
Chief financial officer and executive
director
P R S
Date of first appointment: 1 July 2014
Date of last appointment: 29 August 2014
Area of expertise and contribution: Corporate
finance, capital raising, debt management,
capital allocation, statutory and public
reporting, risk management, systems of
internal control
Nolo Letele
73, male, South African
Non-executive director
S
Debra Meyer
56, female, South African
Independent non-executive director
S*
Roberto Oliveira de Lima
72, male, Brazilian
Independent non-executive director
H N
Date of first appointment: 22 November 2013
Date of last appointment: 25 August 2021
Area of expertise and contribution:
Engineering, media
Date of first appointment: 25 November 2009
Date of last appointment: 25 August 2022
Area of expertise and contribution:
Sustainability, strategy
Date of first appointment: 16 October 2013
Date of last appointment: 25 August 2021
Area of expertise and contribution:
Insights into Brazilian businesses, business
management, information technology
Sharmistha Dubey
52, female, American
Independent non-executive director
A
Date of first appointment: 1 April 2022
Date of last appointment: 25 August 2022
Area of expertise and contribution:
Engineering, insights into tech businesses
Hendrik du Toit
61, male, South African and British
Non-executive director and lead
independent director
N
Date of first appointment: 1 April 2016
Date of last appointment: 25 August 2021
Area of expertise and contribution:
Investment management, sustainability
and economics
Craig Enenstein
54, male, American
Independent non-executive director
H* N
Date of first appointment: 16 October 2013
Date of last appointment: 25 August 2021
Area of expertise and contribution: M&A,
corporate finance, economics, valuations
Steve Pacak
68, male, South African
Non-executive director
P A* R*
Date of first appointment: 15 January 2015
Date of last appointment: 25 August 2022
Area of expertise and contribution: M&A,
finance, risk, strategy
Ying Xu
59, female, Chinese
Independent non-executive director
Date of first appointment: 26 June 2020
Date of last appointment: 21 August 2020
Area of expertise and contribution:
Corporate finance, retail, insights into online
businesses in China
Cobus Stofberg
72, male, South African
Non-executive director
S
Date of first appointment: 16 October 2013
Date of last appointment: 25 August 2022
Area of expertise and contribution: M&A,
corporate finance, strategy
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53, female, Indian
Independent non-executive director
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Date of first appointment: 1 October 2019
Date of last appointment: 25 August 2022
Area of expertise and contribution:
Investment banking, economics, corporate
finance, insight into Indian businesses
Rachel Jafta
62, female, South African
Independent non-executive director
P N* S R
Date of first appointment: 23 October 2003
Date of last appointment: 21 August 2020
Area of expertise and contribution:
Economics, sustainability, corporate
governance and education
Angelien Kemna
65, female, Dutch
Independent non-executive director
A R
Date of first appointment: 15 April 2021
Date of last appointment: 25 August 2021
Area of expertise and contribution: M&A,
finance, risk, corporate governance
Mark Sorour
61, male, South African
Non-executive director
P
Date of first appointment: 15 January 2015
Date of last appointment: 21 August 2020
Area of expertise and contribution: M&A,
corporate finance, strategy
14
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Integrated annual report 2023
Key
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Audit committee
Risk committee
Social, ethics and
sustainability committee
Projects committee
Nominations committee
Human resources
and remuneration committee
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For more detailed biographies, including relevant outside positions on each director, refer to our
website at www.naspers.com.
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Integrated annual report 2023
15
Chief executive’s review
Improving everyday life
We use technology to improve daily life for
billions of people. This creates sustainable
value for our customers and communities, our
many stakeholders and our group as we build
companies that today serve over two billion
customers. We believe there is much more
to come.
Our approach is founded on a
multigenerational record of innovation,
adaptation and reinvention. We
understand the opportunity and
importance of solving everyday
problems for customers. Equally, we
understand that local entrepreneurs
are often best placed to do this.
As such, we continually identify and back
innovative, ambitious local entrepreneurs. We
nurture and support the companies we invest
in, because our experience proves this is the
best way to build sustainable businesses.
Entrepreneurs find this long-term approach
attractive, along with access to our operating
experience and global scale. These are
important criteria in a fast-moving and
competitive world where available funding
has almost halved since peaking in
September 2021.
By aligning technology and data with
key customer needs, we are able to
increase convenience, frequency of
use, reliability and safety. This is a
long-term game. It takes ongoing
investment to build the end-to-end
capabilities that enable closer and
stronger relationships with customers
across the ecosystems of our core
segments.
However, it also requires a disciplined approach to capital
allocation, grounded in future returns. Typically, we
progressively grow our capital commitments as we learn and
scale. But we are disciplined about divesting from assets that
no longer meet our rigorous return expectations. A clear
example is our decision to exit the OLX Autos business prior to
year-end, as discussed below.
Since we are focused on capturing the value of future
technological change, AI is integral to our growth, innovation,
and competitiveness. AI is employed ethically and responsibly
across the organisation for improving customer experience
and operational efficiency. We have fully embraced the
potential of generative AI (GenAI), both as a technology to
make all our businesses better, and as a key factor in our
investment decisions. Our central AI team, which we started
about five years ago, is instrumental to be a leader in
developing and responsibly deploying GenAI.
Progress on strategy this year
Our businesses continued to deliver strong growth while
navigating a challenging and fast-changing environment.
Despite widespread uncertainty throughout the review period,
we have made good progress on our strategy to build
valuable businesses across the group.
In 2022, growth expectations and valuations were under
pressure as consumers adapted to higher inflation and
interest rates. To address these challenges, we are reducing
our cost base and we are taking further action to deliver
long-term value to our shareholders.
In March 2023, we announced our exit from OLX Autos. This
adjacency to our core classifieds business of OLX Group
faced ongoing macroeconomic and market challenges.
Higher cost of capital, high inflation and the reversal of
pandemic trends resulted in a significant and persistent
slowdown in the second-hand car market. While OLX Autos
had built leading positions across many of its key markets
given its strong technology platforms and local focus, pursuing
a global growth strategy was no longer the right approach
for our shareholders. We are exploring all options for this
business, acknowledging that significant value exists in
local markets.
The exit of OLX Autos will significantly improve the
profitability profile of our Classifieds segment as a whole
and supports our stated first half of FY25 ambition of a
profitable Ecommerce segment.
That said, this turbulent environment has reduced the risk
appetite for many investors and depressed market valuations,
particularly in the tech and internet sectors. By mid-year, this
had led to a very substantial widening in our discount to the
sum of the group’s asset value. To take advantage of this
dislocation and generate substantial shareholder value, in
June 2022, the group launched an open-ended multiyear
share repurchase programme, funded by the daily sales of
a limited number of Tencent shares and the concurrent
repurchase of Prosus shares. This transaction locks in value
immediately, while at the same time increasing the group’s
exposure to Tencent and its ecommerce portfolio on a
per-share basis.
The recent groupwide initiative at corporate and in the
segments to reduce headcount introduces risks. We rely on
the expertise and knowledge of our people in the markets
in which we operate but the reductions create capacity
constraints that impact people’s morale. We are working
hard to adapt our operations to enhance their sustainability.
We are focusing on core tasks so that our people have a
sustainable workload. We are also changing our processes
to ensure we manage our risks in this evolving legislative
landscape. We remain committed to improving the
engagement of our people and will maintain that focus
in the coming financial year.
Performance
We detail our performance on pages 46 to 73, with a detailed
financial review from page 22.
In summary, on an economic-interest basis, group revenue
from continuing operations grew 7% in local currency,
excluding disposals and acquisitions to US$33.2bn. This was
driven by a healthy 19% (29%)1 increase in Ecommerce
revenues. Trading profit declined to US$3.3bn, reflecting
a lower share of profits from Tencent and increased organic
investment to scale ecommerce extensions. As such, core
headline earnings decreased to US$1.1bn.
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continuing operations grew
7% to US$33.2bn
1 Percentages in brackets represent growth in local currency, excluding mergers
and acquisitions (M&A).
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Integrated annual report 2023
17
The power of technology is driving
change in the world and Naspers is
at the heart of this change.
Bob van Dijk
Chief executive
16
NASPERS
Integrated annual report 2023
Chief executive’s review continued
As a global consumer internet group and a leading long-term
technology investor, we recognise the power of technology to create
solutions for some of the world’s most pressing needs.
We are cutting costs as we expect the operating environment
to remain challenging for the foreseeable future. We are
accelerating various paths to profitability, with direct
incremental investment in areas where we identified the best
opportunities to create future value, profitability and cash flow
generation. We closed operations where we believe profitable
growth cannot be achieved. This will improve both operating
leverage and profitability for the group in the medium term
while creating a more efficient operating structure in the long
term. We also continued cost-saving initiatives, reducing our
corporate footprint.
To summarise our results, beginning with the four components
of our Ecommerce segment:
» Food Delivery’s performance remained robust, driven by
growth in quick commerce, which leverages the scale
achieved in the restaurant delivery business. iFood grew in
scale and improved its consolidated trading margins in both
core food delivery and quick commerce. Given this strength,
we acquired the remaining 33.3% stake of iFood from Just
Eat Takeaway for €1.5bn, plus a contingent consideration of
up to €300m.
» Classifieds’ revenue grew strongly and the core Classifieds
sustained growth and improved profitability, despite the
impacts of a tough global economy and Russia’s invasion of
Ukraine, which significantly affected OLX Europe.
» In Payments and Fintech, the business continued to show
growth in the core payment service provider (PSP) business
and in credit in India. India’s payments business grew on
the back of increased wallet share in existing merchants
and further diversification of the revenue base, both of
which contributed to the improved trading profit margin.
Global Payments Operations (GPO) showed robust revenue
growth but was impacted by currency translation, while a
once-off loss provision due to a merchant that went
bankrupt and higher merchant acquisition costs drove GPO
into a trading loss. Credit continued to scale while
improving its trading margin through operating leverage.
» Edtech recorded 28% (18%) revenue growth. Our enterprise
platforms, Stack Overflow and GoodHabitz, invested in
product enhancement and footprint expansion, which drove
a higher trading loss. Such investments were necessary to
scale the platforms and improve product offerings as these
businesses are positioned to benefit from companies
upskilling and reskilling their workforce in a fast-changing,
technology-driven world.
» In our Etail segment, eMAG had a challenging year as
online demand subsided in the face of a resurgent
post-pandemic offline economy. In addition, the war in
Ukraine resulted in a broader macroeconomic slowdown
across Central and Eastern Europe.
» Our Ventures arm adopted a prudent approach. While
investing less capital during the year, the team continues
to build a healthy pipeline of prospects for coming years.
Ventures remains our engine for growing into new segments
and markets.
Responsible operator and investor
As a global consumer internet group and a leading long-term
technology investor, we recognise the power of technology to
create solutions for some of the world’s most pressing needs.
We view technology as the cornerstone of a successful
transition to a green economy that is inclusive and leaves no
one behind.
As such, we are creating sustainable value through strategies
that improve material efficiency, driving a systemic transition
to a circular economy and low-carbon growth.
We are embedding our groupwide climate transition plan by
setting and achieving absolute reduction targets on our
net-zero journey.
In line with our decarbonisation strategy, we are setting
groupwide, multiyear, science-based greenhouse gas
emissions reduction targets that will drive our climate
transition plan.
The war in Ukraine
Russia’s protracted war on Ukraine remains a human tragedy,
with significant global, social and economic repercussions.
While our OLX business in Ukraine has proven its resilience,
we continue to support our people in several ways, and with
financial support for humanitarian initiatives in the country.
In our last report, we announced our exit from the Russian
classifieds business, Avito. We completed this disposal and
received proceeds of RUB151bn (US$2.4bn) in October 2022.
Avito is now treated as a discontinued operation in the
financial results and thus excluded from continuing operations.
We also renounced our entire stake in VK, a social and
internet platform in Russia.
Looking forward
We adapted our strategy to an uncertain macroeconomic
environment to drive continued development of valuable,
global, consumer internet businesses. The fundamentals
of these businesses remain sound. We continue to have
conviction in our platforms and are excited about
opportunities ahead.
We are long-term investors and have invested
through a number of economic downturns in volatile
internet markets. We remain disciplined in our
capital allocation, as investments now face a higher
bar. We will continue to drive profitability, build scale
and take action to manage expenses and free cash
flow, even as we invest for growth. In the current
environment, we maintain our preference for organic
investment – focused on credit, and food and
grocery delivery. We are building capabilities,
expanding ecosystems and improving
competitiveness to accelerate growth and deliver
returns across our portfolio. This will expand the
profit potential of our ecosystems over the
medium term.
A healthy liquidity profile is helpful in uncertain times. Our
ambition remains to manage the balance sheet within our
investment-grade rating.
Finally, we remain committed to structural actions that unlock
value for our shareholders over time. As part of this
commitment, we will continue our open-ended repurchase
programme as long as the discount remains elevated to
structurally improve returns on investment.
Bob van Dijk
Chief executive
26 June 2023
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Integrated annual report 2023
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19
Chief financial officer’s review
In presenting and discussing our performance,
we use certain alternative performance
measures not defined by IFRS, referred to
as non-IFRS-EU financial measures, alternative
performance measures or APMs. Such
measures include economic-interest-basis
information; trading profit; adjusted EBITDA;
headline earnings; core headline earnings;
and growth in local currency, excluding
acquisitions and disposals. Segmental reviews
in this report are prepared showing revenue
on an economic-interest basis (which includes
consolidated subsidiaries and a proportionate
share of associated companies and joint
ventures), unless otherwise stated.
Numbers included in brackets represent the
equivalent measure on the basis of growth
in local currency, excluding acquisitions and
disposals. For further explanation of the use
of APMs, refer to about this report in the
governance section.
A reconciliation of the alternative performance
measures to the equivalent IFRS metrics is
provided in ‘Other information – Non-IFRS
financial measures and alternative
performance measures’ of these consolidated
annual financial statements.
The operating environment in the fiscal
year ended 31 March 2023 remained
difficult and continued to be
characterised by geopolitical and
macroeconomic uncertainty. Amid that
uncertainty, the group leveraged its
strong financial footing and remained
focused on building long-term
sustainable value in local
marketplaces across its main
segments. After years of investment
and growth, these segments have
scaled meaningfully, creating clear
paths to profitability for each. The
group is committed to achieving
consolidated Ecommerce profitability
in the first half of FY25 while
maintaining industry-leading levels of
growth. We believe this will form a
strong basis to continue delivering
long-term value to our shareholders.
Please note that the growth rates discussed below represent a
comparison between FY23 and FY22, unless otherwise stated.
The percentages in brackets represent local currency growth,
excluding mergers and acquisitions (M&A), and a clearer view
of the underlying operating performance.
Operating review
Our Ecommerce businesses maintained topline momentum.
Consolidated revenue from continuing operations grew 8%
(20%) to US$6.8bn, with the biggest contributions from Food
Delivery, and Payments and Fintech. Given a sharp rise in the
cost of capital, M&A investment of US$2.5bn was considerably
lower than in recent years. We continue to explore
opportunities, but are cautious as private market valuations
remain high.
Increased consolidated trading losses from continuing
operations of US$844 reflect our focused approach to
incremental investment in our Ecommerce growth extensions.
Our businesses are focused on accelerating their paths to
aggregate profitability while continuing to invest in high-
conviction growth areas. We drove efficiencies and cut back
aggressively on costs, including at a corporate level. This
supported an improvement in trading loss from US$376m
in the first half of the year to US$263m in the second half in
our Ecommerce segment. For the year, growth extensions
accounted for US$492m of the trading losses. With the
decision on OLX Autos, cost focus and focused investment on
opportunities with high conviction on future profitability, we
expected a continued significant reduction in trading losses
in each reporting period and are committed to delivering
consolidated Ecommerce trading profit during the first half
of the 2025 financial year.
The core Classifieds business delivered sustained growth and
improved profitability through stable operating metrics and
strong performance in Europe. The autos and real-estate
verticals and pay-and-ship initiatives contributed to revenue
growth. Like listed peers, the OLX Autos business faced
significant challenges and the group announced its intention
to exit this business. This decision was driven by a major
deterioration of market conditions in this industry towards the
end of the second half of the year. The exit of OLX Autos
will lead to a sizeable improvement in Classifieds and
Ecommerce profitability.
Food Delivery’s performance remained strong, with revenue
growing well ahead of peers and profitability improving
meaningfully. iFood continued to benefit from sustained
momentum in the core restaurant food-delivery businesses and
improved extensions, with targeted and disciplined investment
in quick commerce and grocery marketplace. Given the
group’s conviction in iFood, we acquired the remaining 33.3%
stake of iFood from Just Eat Takeaway in November 2022 for
€1.5bn, plus a contingent consideration of up to €300m.
Payments and Fintech continued to see meaningful growth in
the core payment service provider (PSP) business and in its
burgeoning Indian credit business. India’s payments business
grew on the back of increased wallet share in existing
merchants and further diversification of the revenue base, both
of which contributed to improved trading profit margin. The
credit business in India continued to scale and improved its
trading loss margin, now approaching breakeven, by
diversifying funding sources and enhancing cost discipline and
risk management. The Global Payments Operations (GPO)
showed strong revenue growth, but profitability was impacted
by a once-off loss provision. Excluding this provision, the GPO
business remains profitable.
In Edtech, our majority-owned enterprise platforms, Stack
Overflow and GoodHabitz, continued to grow but investments
weighed on profitability. We invested in sales, product
enhancements and global footprint expansion to better
position the businesses, improving their overall product
offerings and bringing scale to the platforms as corporations
look for alternative ways to upskill and reskill their workforces.
The current focus of investment is to leverage our strong
generative AI (artificial intelligence) in-house capabilities to
deliver significant value to customers.
Our robust balance sheet continues to provide liquidity and
optionality with which to navigate a volatile environment.
During the year, the balance sheet benefited from Tencent’s
distribution of JD.com and Meituan shares. The group exited
the JD.com stake mid-year and received US$3.7bn. The
Meituan shares were received on 24 March 2023. In April
2023, Tencent announced a 50% increase in its dividend,
which resulted in a dividend of around US$758m received
in June 2023.
In October 2022, the group completed the disposal of its
Russian classifieds business, Avito, and received the proceeds
of RUB151bn (US$2.4bn). Avito is treated as a discontinued
operation in the financial results and thus excluded from
continuing operations. For OLX Autos, the operations that are
classified as held for sale and the operations that are closed
down by 31 March 2023 have been presented as discontinued
operations and are reviewed separately by the CODM. OLX
Autos operations whose exit process has not been finalised as
at 31 March 2023 are presented as continuing operations.
In all, the group ended the year in a strong position with
US$16.6bn in gross cash and cash equivalents and US$16.0bn
in debt.
Decisive management actions in the
review period support our purpose
and strategy to create value for
shareholders and all stakeholders.
Basil Sgourdos
Chief financial officer
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Integrated annual report 2023
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Integrated annual report 2023
21
Chief financial officer’s review continued
We are pleased with the group’s resilient performance and
financial footing in a particularly difficult macroeconomic
environment. As noted by the chair, in FY23, we initiated an
open-ended repurchase programme of Prosus and Naspers
shares to preserve value for shareholders and increase our
net asset value (NAV) per share over time. As announced, this
is being funded by the regular on-market sale of Tencent
shares. In the review period, we sold 3% of our shareholding
in Tencent (being 9.7% of the issued share capital), generating
proceeds of US$10.7bn and reducing our holding to 26.16%.
At the closing price of HK$385.8 on 31 March 2023, this stake
is valued at US$123bn. We have been investors in Tencent for
over 20 years, and remain confident in the future of the China
tech industry and Tencent in particular. By 31 March 2023,
Prosus had repurchased 152 797 117 Prosus shares and
4 152 285 Naspers shares, with a total value of US$10.5bn.
Naspers bought 16 320 371 for an additional US$2.5bn,
leading to a 4.5% accretion in the NAV per share. As long as
the discount remains elevated, the group will continue to take
advantage of this market aberration to create value for
shareholders on a daily basis.
As part of this programme, Naspers received approval
from the South African Reserve Bank to continue funding its
buyback with regular sales of Prosus shares. By 31 March 2023,
Naspers had sold 43 356 695 Prosus shares and bought back
16 320 371 of its own shares to the value of US$2.5bn. Over
time, the group intends to execute the programme in a manner
that will keep the respective Prosus and Naspers free-float
shareholder groups’ relative economic interest in the
underlying assets aligned with their position at the start of the
programme.
In the fiscal year ended 31 March 2023, and in coming years,
the group remains committed to: bringing its consolidated
Ecommerce portfolio to profitability; continuing the open-
ended share repurchase programme while its shares remain
at elevated discount levels; pursuing simplification of the
overall corporate structure; and crystallising value for investors
in our portfolio of assets. We believe that these drivers acting
in concert will result in meaningful value creation and
shareholder return.
Given the wide geographical span of our operations and
significant M&A activity in ecommerce, reported earnings were
materially impacted by foreign exchange movements and the
effects of acquisitions and disposals.
Financial review
Revenue
Our total revenue increased by US$484m, or 8%,
from US$6 294m in the year ended 31 March 2022
to US$6 778m in the year ended 31 March 2023,
primarily due to the biggest contributions to growth
from Food Delivery, and Payments and Fintech.
We operate in countries and markets across the world,
resulting in significant exposure to foreign exchange volatility.
This can have an impact on reported revenues and costs
as they are generally denominated in the local currency. The
financial performance of our businesses is accounted for
in the group in their respective functional currencies and
translated to US dollar. The weakening of certain currencies
against the US dollar in the year ended 31 March 2023
negatively affected our year-on-year performance by
US$2 721m, or 43%, through the translation impact, specifically
in the Classifieds, and Payments and Fintech businesses.
Revenue growth expressed in local currency, excluding
acquisitions and disposals, of 7% was achieved in the year
ended 31 March 2023.
Total revenue (%)
2
2
1
20
1
15
6
Online sale of goods revenue
Classifieds listings revenue
Payment transaction
commissions and fees
Mobile and other content
revenue
Food-delivery revenue
Advertising revenue
Printing, distribution, circulation,
publishing and subscription
revenue
Edtech
Other revenue
3
50
US$’m
3 358
436
987
52
1 366
99
120
134
226
%
50
6
15
1
20
1
2
2
3
Total
6 778
100
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NASPERS
Integrated annual report 2023
Online sales of goods revenue represented 50% and 56% of
our total revenue in the year ended 31 March 2023 and the
year ended 31 March 2022 respectively.
Revenue by geographic market (US$’m)
2 500
2 000
1 500
1 000
500
0
Africa
Asia
Central
Europe
Eastern
Europe
Western
Europe
Latin
America
North
America
Other
●
2023
●
2022
Africa
Asia
Central Europe
Eastern Europe
Western Europe
Latin America
North America
Other
Total
2023
1 077
528
641
2 131
62
2 252
87
0
6 778
2022
1 135
358
736
2 124
99
1 776
65
1
6 294
Group revenue, measured on an economic-interest basis, was
US$33.2bn, grew 7% in local currency, excluding acquisitions
and disposals, driven by a healthy 19% (29%) increase in
Ecommerce segment revenues.
Costs of providing services and sale of goods
The costs of providing services and sale of goods increased
by US$221m, or 5%, from US$4 662m for the year ended
31 March 2022 to US$4 883m for the year ended
31 March 2023.
Platform/website hosting, warehousing costs and costs
of goods sold on those platforms decreased by US$22m, from
US$3 151m in the year ended 31 March 2022 to US$3 129m
in the year ended 31 March 2023.
Delivery service costs increased from US$611m in the
year ended 31 March 2022 to US$738m in the year ended
31 March 2023. This increase primarily related to logistics
costs in the Food Delivery business on the back of increased
gross merchandise value (GMV) of 27%.
Payment facilitation transaction costs increased by US$98m
from US$605m in the year ended 31 March 2022 to US$703m
in the year ended 31 March 2023. The increase primarily
related to the Payments and Fintech business, particularly in
India, where the increased transaction volumes with merchants
resulted in increased transaction processing costs. In addition,
following the growth in the Food Delivery business, payments
facilitation costs increased accordingly.
Selling, general and administrative costs
Selling, general and administrative costs increased by
US$78m, or 3%, from US$2 454m in the year ended 31 March
2022 to US$2 532m in the year ended 31 March 2023.
General business administrative cost increased by US$64m
from US$477m in the year ended 31 March 2022 to US$541m
in the year ended 31 March 2023, primarily due to cost
increases across all the segments as they scale.
Staff costs1 decreased by US$73m, or 5%, from US$1 532m
in the year ended 31 March 2022 to US$1 459m in the year
ended 31 March 2023, primarily due to a decrease in
share-based compensation costs. This was partially offset
by increased salaries, wages and bonuses resulting from
annual increases.
Total number of employees (%)
3
3
8
12
16
Etail
Food Delivery
Classifieds
Payments and Fintech
Print
Edtech
Other
Corporate
Total
1
38
19
Number of
employees
10 366
5 210
4 500
3 447
2 167
859
750
274
%
38
19
16
12
8
3
3
1
27 573
100
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Integrated annual report 2023
23
Chief financial officer’s review continued
Share of equity-accounted results
Profit from discontinued operations
Our equity-accounted results in equity-accounted companies
decreased by US$4 080m, or 44%, from US$9 256m in the
year ended 31 March 2022 to US$5 176m in the year ended
31 March 2023. This is driven primarily by a decrease in our
share of fair value gains on financial instruments of US$1.7bn,
reduced gains on acquisitions and disposals of US$396m and
additional impairment losses of US$827m. This was in addition
to reduced profitability in Tencent of US$1.2bn and a
decrease in Tencent’s contribution to equity-accounted
earnings as a result of the sale of this investment to fund the
open-ended share repurchase programme.
Impairments
Impairment on goodwill increased from US$246m recognised
in the year ended 31 March 2022 to US$684m in the year
ended 31 March 2023. This relates to an impairment of
US$560m recognised on Stack Overflow and US$116m
recognised on the OLX Autos business unit.
Impairment on equity-accounted investments increased from
US$588 recognised in the year ended 31 March 2022 to
US$1 745 in the year ended 31 March 2023. This relates to an
impairment of US$997m (recognised in the first half of the
financial year related to Delivery Hero), US$301m related to
Skillsoft and US$448m related primarily to unlisted equity-
accounted investments.
Net gains on acquisitions and disposals
Gains on acquisitions and disposals of US$50m were
recognised in the year ended 31 March 2023, compared to
a loss of US$1 128m in the year ended 31 March 2022.
In March 2022 a loss of significant influence of US$1 137m
was recognised on VK as a result of our resignation from the
board of directors. This relates primarily to the reclassification
of a portion of the group’s foreign currency translation
reserves related to VK from other comprehensive income to
the income statement.
Taxation
Our tax expenses decreased by US$16m, or 25%, from
US$64m in the year ended 31 March 2022 to US$48m in the
year ended 31 March 2023.
Discontinued operations consist of the group’s Russian
business and the autos business unit. In May 2022, as a result
of the continued conflict in the region, the group announced its
decision to exit its Russian business. Accordingly, Avito was
presented as a discontinued operation. The transaction was
completed in October 2022. The group recognised a gain on
disposal of the subsidiary of US$568m. Discontinued
operations for the OLX Autos business include the operations
classified as held for sale and the operations closed down by
31 March 2023. Refer to note 36 for details of this business
unit’s disposal group.
Core headline earnings
Core headline earnings for the year were US$1.1bn, a
decrease of -48% (-14% in local currency) or US$1.0bn,
primarily due to lower contributions from our associates
(US$1.3bn) of which US$1.1bn relates to Tencent. Refer to
‘Other information – Non-IFRS financial measures and
alternative performance indicators’ of this report for a
reconciliation of non-IFRS financial measures.
Cash and debt position
At year-end the group had a net cash position of US$0.6bn,
comprising US$16.6bn in cash (including short-term
investments) net of US$16.0bn of interest-bearing debt
(excluding capitalised lease liabilities).
The group’s free cash outflow (excluding Avito) was US$518m,
a sizeable year-on-year improvement. This was due to
improved working capital management and lower tax paid,
specifically withholding tax due to fewer Avito dividends being
received. Excluding OLX Autos, the free cash outflow was
limited to US$138m. Tencent remains a meaningful contributor
to our cash flow via a stable dividend of US$565m.
Basil Sgourdos
Chief financial officer
26 June 2023
Total permanent staff decreased from 28 300 at 31 March
2022 to 27 573 at 31 March 2023. Staff decreased particularly
in the Classifieds and Etail segments. For further information
regarding headcount, refer to the section on our people on
page 79.
Cash share-based compensation costs decreased by
US$344m due to changes in valuation assumptions, including
share prices and volatility, as well as the impacts of
allocations made and vesting of options.
Depreciation and amortisation
Depreciation and amortisation in selling, general and
administration expenses increased by US$27m, or 14%, from
US$197m in the year ended 31 March 2022 to US$224m in
the year ended 31 March 2023. The increase in depreciation
expenses primarily related to the acquisitions of property,
plant and equipment, notably computer and office equipment,
following growth in our Food Delivery businesses. Amortisation
increased on the back of acquired intangible assets related
to business combinations.
Finance income/(costs) – net
Net finance cost decreased by US$261m from US$349m in the
year ended 31 March 2022 to US$88m in the year ended
31 March 2023.
Interest expense increased by US$164m, or 40%, from
US$407m in the year ended 31 March 2022 to US$571m in
the year ended 31 March 2023, as a result of full-year interest
paid on the publicly traded bonds.
Interest income increased by US$425m, or 733%, from US$58m
in the year ended 31 March 2022 to US$483m in the year
ended 31 March 2023, due to increased cash balances
on hand.
Interest expense relates primarily to interest on the publicly
traded bonds. Interest income includes interest earned on
bank accounts and short-term investments.
Other finance income increased from a finance loss of
US$91m for the year ended 31 March 2022 to an income
of US$19m for the year ended 31 March 2023. This relates
primarily to a gain on foreign exchange differences related to
the foreign exchange impacts on the translation of assets and
liabilities offset by fair value losses of derivative instruments,
which include options exercised, forward exchange contracts,
derivatives embedded in lease agreements and the cross-
currency interest rate swap.
24
NASPERS
Integrated annual report 2023
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Integrated annual report 2023
25
Engaging with our stakeholders
To create sustainable value for our stakeholders, we actively engage
with them to elicit their feedback to further inform our direction and
strategic choices. We value their input and build constructive, long-
term relationships to enable ongoing dialogue.
To support the board in fulfilling its governance role, the social, ethics and sustainability committee retains oversight of
stakeholder management across the group. To balance the needs, interests and expectations of a diverse group of stakeholders,
we take an inclusive approach.
Identifying material matters
Last year, we conducted a materiality assessment. This helped us identify material matters that are high priority for our
stakeholders and with a significant potential impact on our business and society. We focus on these material matters and
proactively communicate our position and performance on each, with three overarching objectives: to mitigate risk, manage
performance and create sustainable value.
Based on feedback from our stakeholders, we identified 11 material matters. Predictably, for a technology group, these include
data privacy, cyber-resilience, digital inclusion and artificial intelligence. Sustainability issues – from climate action to responsible
investment – are high on that list. Stakeholders affected and our responses are summarised by stakeholder group on the
following pages.
Our key stakeholder groups:
Materiality results
1 Customers and users
2 Employees
We want to help customers and users improve their
everyday lives. Customers are indirectly represented
through our portfolio of companies across various
geographies that deliver services to their customer base.
Our employees are at the heart of our success. Their
commitment and entrepreneurial drive make all the
difference.
3 Investors
4 Business partners
We are a for-profit organisation committed to delivering
value to shareholders and investors.
We work closely with our business partners, including
suppliers and consultants.
5 Industry bodies
6 Our planet and society
We aim to be an industry leader in both the digital
technology and investing sectors, playing an active part
in our shared progress.
We are committed to making a lasting positive impact for
society and the world we live in.
7 Media
8 Government and regulators
We report transparently and aim to communicate to our
broad stakeholder community through constructive
relationships with the media.
We recognise how important it is to work with
governments and regulators as our portfolio of
companies have a big impact on people’s lives across
diverse jurisdictions.
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Financial
performance
Business culture,
ethics and
integrity
Climate action
Cyber-
resilience
Innovation
People
Community
investment
Responsible
investments
Data privacy
Digital inclusion
AI
Impact of the company on economic, environmental and social matters
With a view on the upcoming Corporate Sustainability
Reporting Directive (CSRD) regulation, we have started the
process to update our materiality assessment to align with the
double-materiality approach. This means looking at material
matters that represent relevant impacts of our business on the
economy (environment, people and their human rights) as well
as those that have or could have financial effects on Naspers.
Building on our existing material matters, we created a long
list of topics informed by the latest World Economic Forum
(WEF) global risks report, referenced to the standards of
European Sustainability Reporting Standards (ESRS) and the
Sustainability Accounting Standard Board (SASB). This list was
contextualised to Naspers and referenced to our internal risk
register. This list formed the basis of an online survey that
asked stakeholders/experts to prioritise material matters and
rank them based on: severity of impact on the economy,
environment and people; and magnitude of potential financial
effect on Naspers in the short, medium and long term.
We will continue to engage with stakeholders and experts to
complete this assessment in coming months as interpretations
of CSRD (and the underlying European Sustainability Reporting
Standards) become clearer. We will disclose results in the
next year.
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NASPERS
Integrated annual report 2023
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Integrated annual report 2023
27
Engaging with our stakeholders continued
Our material matters
Financial performance
We create value by growing our revenues and
market shares, increasing our exposure to
financial revenue from sustainable business
models and driving profitability and cash
generation. Our understanding of sustainable
value creation applies strict discipline to
capital allocation and performance
management.
See page 22.
Material matter
Financial
performance
Stakeholders affected
» Investors and
shareholders
Artificial intelligence
We invest in pioneering technologies, guided
by our group principles for the responsible
application of AI. In building software-led
business models, we aim to create value, and
to engage in external advocacy for the ethical
development of AI.
See pages 86 to 88.
Material matter
AI
Stakeholders affected
» Society
» Customers and users
» Business partners
» Investors and
shareholders
» Government and
regulators
Material matter
Cyber-
resilience
Stakeholders affected
» Society
» Customers and users
» Business partners
» Investors and
shareholders
» Government and
regulators
Material matter
Data
privacy
Stakeholders affected
» Society
» Customers and users
» Business partners
» Investors and
shareholders
» Government and
regulators
Cyber-resilience
We take cybersecurity seriously. Across our
group, we protect the information technology
infrastructure of businesses, governments and
households against increasingly disruptive,
frequent and sophisticated cybercrimes that
could result in economic damage, financial
loss, geopolitical tensions and social instability.
See pages 89 to 91.
Data privacy
We create and adhere to the right policies and
frameworks to control and secure the data of
our business, customers and employees.
See pages 92 to 94.
Business culture, ethics and integrity
We embed our group goals, purpose and
values in all business activities and operations.
Although our influence on investees varies
across our portfolio and supply chain, we are
committed to effective communication and
engagement with all our stakeholders.
Material matter
Business culture,
ethics and integrity
Stakeholders affected
» Customers and users
» Business partners
» Employees
See pages 95 and 96.
Community investment
We invest for real and sustainable impact in
the communities where we live and work,
applying the principle that local actors know
best how to deliver meaningful change in local
contexts.
Material matter
Community
investment
Stakeholders affected
» Society
See pages 98 and 99.
Climate action
Reducing GHG emissions and energy
consumption is a priority for all our operations
and investments.
See pages 100 to 109.
Material matter
Climate
action
Stakeholders affected
» All
Responsible investments
We are a responsible investor. We apply ESG
factors in selecting and assessing new
prospects and apply these criteria in managing
the performance of businesses and investments
across our portfolio.
Material matter
Responsible
investments
Stakeholders affected
» All
See page 77.
People
We help people achieve their potential and be
their best. We work to realise this aspiration for
our employees and across the value chain of
our businesses, including for the many
thousands of people who work on our
platforms around the world.
Material matter
People
Stakeholders affected
» Employees
See pages 78 to 82.
Digital inclusion
Digital inclusion underpins our business
strategies. We extend access to digital
products and services, promote digital literacy
and support information technology
infrastructure.
Material matter
Digital
inclusion
Stakeholders affected
» Employees
» Customers and users
See page 82.
Innovation
We find, nurture and scale innovative
technology to create new ways of doing
business. Our investments in sustainable value
creation contribute to positive and systemic
change by developing solutions to societal
needs.
Material matter
Innovation
Stakeholders affected
» All
See pages 82 and 85.
28
NASPERS
Integrated annual report 2023
Stakeholders
Customers and users
What matters to them
» Positive experience – safety, fast
delivery, return and feedback
» Competitive pricing and range of
products
» Content preference
» Trust
» Data privacy
Material matters
How we engage
» Call centres, showrooms and client
relationship managers
» Electronic communication (email,
SMS, apps, web and social media
platforms)
» Workshops and events
» Surveys and market research
Employees
Material matters
What matters to them
» Providing jobs with meaning and a
sense of purpose
» Recruitment, retention and
development of talent
» Culture, including diversity and
inclusion, employee wellbeing and
engagement
» Job security
How we engage
» Ongoing dialogue with our people
is embedded in our work practices
» Formal and informal channels to
engage and encourage open
communication, from leadership
and CEO updates by email and
video to face-to-face gatherings,
online collaboration and content-
sharing
» Continuous learning and
development through our online
learning platform MyAcademy, and
through live education programmes
» Support given to retrenched
employees
Society
Material matters
What matters to them
» Social investment to support
meaningful impact
How we engage
» Community investment programmes
» Employment offering and service
» Minimising our environmental
providers
impact
» Local employment and value
creation, including supporting local
businesses
» Adhering to local laws and paying
taxes due
» Website content and public
announcements on material
matters
Our response and impact
» We are continuously improving our
product ranges and the customer
experience.
» We ensure our offerings are
competitively priced.
» Our customer-focused initiatives
include investing in and
developing AI and ML to improve
convenience and safety, to
developing new services such as
home delivery of groceries.
Our response and impact
» We continually invest in
developing our people, including
creating and supporting
professional development
opportunities.
» We recognise great work through
fair and competitive rewards.
» We focus on building an inclusive,
empowered and supportive
culture.
» We care for our people through
various health and wellbeing
initiatives.
» On our path to profitability,
cost-saving initiatives were
necessary, including staff
reductions.
Our response and impact
» Our businesses focus on
maximising positive impact in
local communities.
» Our group aim is to develop
products and services that meet
societal needs.
» We contribute to enabling and
encouraging conscious
consumerism.
» We focus on hiring local
employees and growing local
talent, including investing in local
businesses.
» Safety of our employees is
paramount, for example our
initiatives in Ukraine.
» Our group legal compliance
programme is tailored to unique
risks and local laws for each
business.
» We adopt a responsible approach
to tax.
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Positive
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Challenging
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Integrated annual report 2023
29
Engaging with our stakeholders continued
Media
Material matters
How we engage
» Press releases, editorials and
articles
» Interviews and reactive comment
» Reporting through company
website
» Events
What matters to them
» Our investment strategy and
performance
» Requests for comment on rumour
and speculation, notably on
potential acquisitions and
divestitures
» Requests for comment on
reputational risk issues, such as
cybersecurity and privacy
» Our focus on geographies and our
view on key industry segments
» How we work across our group
companies
Investors
Material matters
What matters to them
» Holding-company discount
» Path to profitability and cash flow
How we engage
» Investor meetings and
teleconferences
» Conference participation
» Interim and annual reports
» Financial results presentations and
investor days
» Business deep-dives
» Press and stock exchange releases
» Reporting via corporate website
» Dedicated email address for
inbound queries and distributing
announcements
» Instructive videos
generation
» Developing the optimal structure for
the group
» Capital allocation: Further
buybacks, investment in core
assets, and responsible M&A
» Crystallising value at the right time
» Internal rates of return
» Remuneration policy and disclosure
» ESG strategy, performance and
disclosures
» Strategy for core segments, and
how we are investing for growth
» Competition in various markets
» Our approach to managing
geopolitical and macroeconomic
risks
Governments and regulators
Material matters
What matters to them
» Sustainable development
» Innovation and entrepreneurship
» Competition policy
» Taxation
» Investments and international trade
» Data protection and privacy
» AI
» Cyber-resilience
» Private-public partnerships,
international and other
collaborations
» Intermediary liability
» Financial services legislation
» Copyright and intellectual property
(IP)
» Tech policy, including ecommerce
» Societal contribution, including
employment and social policy
How we engage
» Direct participation in advisory
committees, meetings and public
consultations
» Formal one-on-one meetings and
round-table discussions
» Response to sector and company-
specific enquiries
» Indirectly through sector and
industry associations
» Participation in international events,
such as BRICS (Brazil, Russia, India,
China and South Africa) summits
and membership of the World
Economic Forum in Davos
» Site visits, including hosting official
delegations
» Annual report
Our response and impact
» We regularly engage with key
journalists and editors to build
relationships and understanding.
» We proactively schedule media
interviews to brief them on
strategic updates and significant
news.
» We build announcement plans to
maximise coverage.
» We respond to requests for
comment in line with
communications and investor
relations policies.
» We are quick to correct inaccurate
commentary or articles, as
appropriate.
Our response and impact
» Management engages regularly
with investors.
» Our engagement and reporting
includes focused messaging on
the path to profitability, value
crystallisation, open-ended
repurchase programme and
simplifying the group structure.
» We provide biannual updates on
our internal rate of return for the
total portfolio and Ecommerce.
» We are concentrating on reducing
the holding-company discount.
» We improved our ESG
communications and disclosures.
Our response and impact
» We are transparent and have
implemented a programme to
ensure compliance with all
applicable laws and regulations.
» We make formal representations
and written submissions to express
views.
» We provide information to
policy-makers in the form of expert
advice, based on our global
experience as well as technology
and sector expertise.
Business partners
Material matters
How we engage
» Structured meetings, calls and
electronic communication
» Informal day-to-day communication
What matters to them
» Continued supply of products and
services
» Awareness of relevant
developments in the business
» Understanding and recognising our
partners’ rights, specifically on
changing procurement processes,
pricing, content, platform use,
privacy and security
Industry bodies
Material matters
What matters to them
» Clear communication of material
matters
» Engagement around increasing
meaningful and positive impact
» How to ensure a positive sector
experience, for example through
regulation and culture of the
sectors
How we engage
» Membership of selected and
appropriate bodies
» Co-operating with selected
partners on projects addressing
legislative initiatives
Our response and impact
» Strong relationship management
systems ensure regular
communication between key
management and business
representatives.
» Structured grievance processes
ensure that, in any dispute, we
take timely action to find a
resolution.
» Through active negotiations, we
ensure mandates clearly lay out
the relationship and agreement
terms and requirements.
» Business approaches are reviewed
regularly to ensure they align with
international norms.
Our response and impact
» We take the lead in responding to
industry consultations on proposed
regulations and legislation.
» To build understanding and
engagement across the industry,
we share our approach and
examples of action on specific
material matters, such as how we
align to changing legislation.
» We produce thought leadership
and position papers.
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Quality of relationship
Positive
Stable
Challenging
Material matters
Financial
performance
Responsible
investments
People
Digital
inclusion
Innovation
Climate
action
AI
Cyber-
resilience
Data
privacy
Business culture,
ethics and integrity
Community
investment
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Integrated annual report 2023
NASPERS
Integrated annual report 2023
31
Our strategy
Our strategy for building sustainable long-term value remains
relevant and differentiated – we pursue growth by building
leading companies that empower people and enrich
communities.
Build global
technology
leaders to …
… address
big societal
needs …
… in high-
growth
markets …
… where we
can build
sustainable
leading
positions.
Underpinned by a rigorous process:
Invest, scale, crystallise
Robust operating model
Global outlook
Local entrepreneurs
Investor
Operator
Our core and sustainable approach
Active: We see funding as
the baseline. We like to play
an active role in the growth
of the companies we back.
Focused: We make targeted
investments across our core
segments.
Long-term view: We are
patient and disciplined,
and we build companies
sustainably over time.
Responsible: We matter
to the customers and
communities that we serve.
We strive to maximise our
positive impact on society
and the planet.
Food Delivery
Classifieds
Payments and Fintech
Edtech
Building four core segments
Three strategic priorities
Flowing from our core strategy and the implications of key trends in the world around us
1 Drive organic growth in our
2 Expand local ecosystems
3 Be a force for good for our
core businesses
stakeholders
Strategic
priority 1:
Drive organic
growth in our
core
businesses
We have
identified
significant
opportunity in
technology
globally, knowing
that certain
markets will
thrive more than
others.
Strategic
priority 2:
Expand local
ecosystems
Our businesses
are building
ecosystems with
a strong local
presence.
Strategic
priority 3:
Be a force for
good for our
stakeholders
Backing winning segments
We will continue to focus on our core segments and drive their organic growth. While tech has done
well across the board, we have invested in segments where we believe there is markedly more
growth potential.
Targeting high-growth markets around the world
» While regulatory change has recently curbed investor enthusiasm in China, we believe it remains
one of the most attractive internet markets, and Tencent is well positioned there. We also believe
regulation is ultimately healthy for any industry or market – in time, businesses will adjust and
investor appetite will return.
» India is a priority, and we are strengthening our teams and investments there. We will focus on
backing local entrepreneurs to ensure we align well with India’s domestic priorities.
» We are investing more in south-east Asia. We see opportunity there – growth is strong and
smartphone adoption is rising rapidly.
» In Brazil, we see strong opportunity for iFood. Again, we are focused on organic growth, particularly
with respect to strengthening iFood’s local ecosystem. That ecosystem is centered around a strong
food-delivery core that is supplemented by offerings in grocery, convenience retail, and fintech.
» We will continue to monitor markets for opportunities and be selective in our approach, prioritising
the biggest opportunities.
» Our Food Delivery businesses are building on their sizeable delivery operations to extend into
adjacent delivery verticals, such as convenience and grocery. This creates more value for customers
and more value for our businesses.
» We are expanding our Payments and Fintech platform in India to create a broader ecosystem.
» We are building valuable local ecosystems around local market heroes, such as eMAG in
Central and Eastern Europe. eMAG is building Romania’s largest last-mile delivery platform, growing
food delivery rapidly, and expanding into grocery delivery.
Shareholders, regulators and many other stakeholders are increasingly interested in how seriously we
take our responsibilities as a global technology group: how well we look after our people and our
customers; the kind of role we play in society; and the impact of our businesses on the planet.
We have a strong heritage of acting responsibly as a group. But much of this good work has been
implicit – a natural consequence of fundamentals such as being disciplined about long-term value
creation, backing entrepreneurs who share our values, and focusing on improving people’s everyday
lives through technology.
We believe it has now become essential that we do business with the stated goal of being a positive
force for the world around us. We will therefore ensure we are all clear on our role in the world, and
on our expectations of each other. Through our Ventures arm, we are increasing our focus on
sustainable investment themes, such as agtech (agriculture technology) and healthtech.
We have also formalised our approach to responsible investing.
You can find more details on page 77.
We are all united by our shared purpose – to improve everyday life for billions of people through
technology – and our shared values.
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NASPERS
Integrated annual report 2023
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NASPERS
Integrated annual report 2023
33
How we create value –
our business model
Our business model is directly linked to our strategy (page 32)
and supports our purpose (page 6).
Material matters
Business activities
How we measure value
Outcomes
SDGs
Build global tech
leaders to ...
... address big
societal needs ...
... where we can
build sustainable
positions.
... in high-growth
markets ...
Our strategy is focused on creating value in
four core segments:
Food Delivery
Classifieds
Payments and Fintech
Edtech
Financial performance1
Financial funds and assets used to
invest and develop our operations
Responsible investments
We proactively limit exposure
to revenues from a defined set
of controversial activities and
increase our exposure to revenues
from sustainability-native business
models
People
Skills of our employees
Digital inclusion
Digital products and services, digital
literacy and support for information
technology infrastructure
Innovation
All investments in facilities and
technologies across the group
AI
Ideas, source codes, domains, know-
how and knowledge we create, own
and protect
Cyber-resilience
Protection of information technology
infrastructure
Data privacy
Data protection, data strategy, AI ethics
and other key issues relevant to digital
platforms
Business culture, ethics
and integrity
Community investment
Trust we build in communities where we
operate
Climate action
Reducing GHG emissions and energy
consumption is a priority for all our
operations and investments
1 Presented on an economic-interest basis.
34
NASPERS
Integrated annual report 2023
We continue to deliver robust financial performance
» Achieve revenue at target
» Achieve core headline earnings of US$564m, including Tencent
» Achieve free cash outflow of US$1.22bn
We deliver long-term shareholder value through disciplined capital allocation
» Meaningful internal rate of return (IRR) ahead of cost of capital
We create workplaces with a fair and inclusive culture
» Diversity and inclusion is a business strategic priority and is measured
» Achieve 87% favourable response to the question ’I feel respected at my company’
in the annual engagement survey
» MyAcademy is also a critical element in our AI and ML transformation plan. We
use it to train people who are not in engineering roles in AI and ML, through our
AI for everyone course
We are committed to investing in and scaling digital services and
technologies to address global challenges at a local level
We provide innovative platforms and services to customers globally
» Continue to build our AI capabilities by increasing the number of ML modules in
production
» Apply strict discipline to capital allocation, and act with integrity to promote ethical
business principles
Through our intellectual property, we drive change and innovation in the
industry
» Throughout the investment life cycle, we strive to ensure that scientific and technical
standards informing design and research in AI products and services are robust,
and of high quality. We assess this continually
We implement and maintain strong cybersecurity and enhance the resilience
of our platforms and systems
» Ensure cybersecurity and technology risks are managed by our businesses
» Focus on ransomware prevention and response preparation
We recognise that privacy is an important value and an essential element of
public trust. We expect each of our businesses to adhere to our group policy
on data privacy governance
» Seven key elements of a data privacy programme to ensure our core data privacy
commitment and approach are followed in ways that really work for our businesses
We are committed to conducting business in compliance with the law and
behaving ethically
» Human rights statement adopted across the group and its subsidiaries
» Enhanced ethics and compliance training
We treat our partners fairly and drive high social value in our operations
» As part of our purpose to use technology to improve the everyday lives of billions
of people, we place great emphasis on promoting inclusive, economically secure
communities by doing what we do best – supporting promising entrepreneurs to
make a lasting impact on the communities around them
» Beneficiaries supported through community investment programmes
The group is committed to achieving net-zero emissions which is embedded
in key performance indicators
» Reduce scope 1 and 2 emissions to zero at group level by year-end FY23
» Enhance ESG performance and implement a climate transition plan
Consolidated group revenue from continuing
operations: US$6 778m
Core headline earnings, including Tencent3:
US$1 056m
Free cash outflow4: US$138m, excluding Avito and
OLX Autos
Total consolidated trading losses from continuing
operations of -US$844m
In the employee engagement survey, we achieved
a global score of 83% favourable responses to our
gender diversity question
We achieved a score of 86% favourable responses
to our inclusion question, ‘I feel respected at my
company’
MyAcademy has enabled 105 technology colleagues
to earn AI nanodegrees and initiate a new career
path in the field
Maintained high standards of product quality
We offer highly specialised training on several AI
themes for engineers and product managers, including
model deployment, ML pipelines, ML operations and
natural language processing. A new addition is a
series of tutorials and practical education modules on
GenAI, such as prompting or training language models
By year-end, the group NAV discount had reduced by
17 percentage points from 58% to 42%, creating over
US$25bn of value for shareholders.
Impairment on goodwill increased from US$246m
recognised in the year ended 31 March 2022 to
US$684m in the year ended 31 March 2023, relating to
Stack Overflow and OLX Autos
500 data scientists on the team
>4 000 software engineers and technical staff who
work with PlusOne AI assistant
Technology and process innovations across our
portfolio
49 advisory and assurance projects to ensure
cybersecurity risk management
Updated cybersecurity policy with a ransomware
addendum; creating a group playbook on how we
would respond to a ransomware attack. Completed
ransomware simulations to further refine our resilience
to this growing threat
Strong brands and solid reputation
All subsidiaries completed two cycles of assessments
across 17 data privacy domains set out in the group’s
privacy maturity model. Each company has selected
at least two specific goals to improve maturity over
the year
Human rights assessments across our value chain
100% of group2 employees completed ethics and
compliance e-learning
Risk assessments and annual plans completed for
each segment, identifying key risks and initiatives for
the year ahead
The Prosus Social Impact Challenge for Accessibility
(SICA) and FLIGHT programmes support sectors
employing underserved populations
Humanitarian relief in Ukraine
In FY23, the Potencia Tech (tech power) platform was
recognised by Notable CNN, and won a prize in the
tech category. This online platform offers free courses,
scholarships and job openings in tech roles, specifically
for people underrepresented in traditional learning
pathways. In FY23, over 30 000 learners signed up and
around 1 500 found employment, 69 at iFood
Reduced scope 1 and 2 emissions to zero at a
corporate level by FY23
Strategy in place to meet our portfolio coverage target
2 Employees in group-level functions.
3 Based on actual Naspers CORE in local currency, excluding M&A, based on budget.
4 Based on actual Naspers FCF, excluding approved adjustments.
NASPERS
Integrated annual report 2023
35
Value creation
Value preservation
Value erosion
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The world in which we operate
Despite significant global uncertainty, we believe technology
can transform how people live their lives in every corner of the
world, creating significant value for all.
We have identified key trends relevant to our business across
the macroeconomic environment, technology and society, and
investor landscape. Their implications have been distilled into
three strategic priorities for the group (covered in our strategy
on page 32).
Macroeconomic environment
Major health, economic and geopolitical events have
impacted the macroeconomic environment greatly in recent
years, and significant uncertainty remains.
India recorded the fastest real GDP growth globally in 2022,
while China has reopened its borders after ending its
zero-Covid policy and is stabilising the environment for
tech regulation. As the world’s two largest internet audiences,
these are both markets in which we have good exposure.
Real GDP growth1 (%)
8
Our world is changing rapidly and we have a role
to play
Eight billion people and rising
Our footprint is in high-growth markets.
Global developments
The shared global challenges of climate change and rising
inequalities demand action from all sections of society.
Increased pressure on natural resources
High-growth markets have the largest vulnerable populations
and resource disparities.
6.9
6.6
Future of business
4.3
3.0
6
4
2
0
3.3
1.9
0.5
US
0.0
Europe
China
India
December 2022
December 2023 (estimated)
Updated on 19 January 2023.
1 Respectively: S&P 500, Euro Stoxx 50, China A50, FTSE India.
Source: World Bank, Fred, Eurostat, Capital IQ, investing.com.
36
NASPERS
Integrated annual report 2023
Growing public demand for corporates to demonstrate value
beyond financials – growth and profit are no longer enough.
Rapid digitalisation
As a digital technology investor and operator, we have both
an opportunity and a responsibility.
Changes in capital markets
ESG investing is no longer the exception but the norm as
investors demand and integrate environmental and social
data into their decisions.
Generative AI
We systematically explore emerging technologies and
accelerate them across the group. Refer to our section on
artificial intelligence on page 86.
Slowing economic growth with record inflation
and rising interest rates
Diverging prospects across countries – China and
India remain strong
While macroeconomic drivers are the same across the world,
there is wide variation in how significant economies have
been performing.
China’s GDP growth in the 2022 calendar year was 3.0%.
While high compared with most Western markets, this is a
significant deceleration from pre-Covid-19 years. This has
been caused by the economic cost of the zero-Covid policy,
the government’s stricter policy stance on tech companies,
and lower demand globally for Chinese exports. With the end
of zero-Covid and a stable environment for tech regulation,
China tech forecasts an improved outlook, although much
uncertainty remains.
India’s economy has demonstrated resilience, despite
a challenging external environment, and it remains one
of the fastest-growing major economies in the world.
Tech and society
The pandemic changed people’s lives forever by accelerating
the use of technology. However, the consequent growth of tech
titans produced a countertrend of anti-tech sentiment and
rising regulation. As a responsible tech operator and investor,
we are well positioned to navigate and contribute to our
changing world – creating value for our stakeholders.
Pandemic patterns persist: We are changed forever
Since the 2020 calendar year, people have redefined how
they work, interact, shop and play, with much of this everyday
activity moving online. As pandemic restrictions have lifted, a
new balance between online and offline is being established,
but the shift to online is now entrenched. At the same time,
sustainability has become a pressing concern given the
mounting evidence of a climate crisis. In tandem with moving
online, people are going green and they increasingly expect
companies to play their part.
The state of the world today was largely caused by the
exogenous shock of the pandemic early in the 2020 calendar
year. While the decade-long bull run, fuelled by low interest
rates and quantitative easing, may have ended for other
reasons eventually, the pandemic forced lockdowns and a
significant economic reversal, both in the real economy and in
markets. Governments responded with massive stimuli, and
some parts of the economy boomed. Inflation jumped and
was fuelled by the spike in energy prices when Russia invaded
Ukraine. Interest rates increased sharply in the 2022 calendar
year and continued to increase in 2023 as central banks
reacted to high inflation rates, resulting in deteriorating
consumer sentiment and slowing economic growth.
Global real GDP growth (%)
6
4
2
0
-2
-4
5
0
0
2
6
0
0
2
7
0
0
2
8
0
0
2
9
0
0
2
0
1
0
2
1
1
0
2
2
1
0
2
3
1
0
2
4
1
0
2
5
1
0
2
6
1
0
2
7
1
0
2
8
1
0
2
9
1
0
2
0
2
0
2
1
2
0
2
2
2
0
2
3
2
0
2
4
2
0
2
Source: World Bank, OECD.
Unsurprisingly, the 2022 calendar year was also a bear
market. Rising rates and slowing economic growth were only
part of the reason, as investor sentiment shifted massively
from growth to profit. The significant market correction, with a
sharp decline in the prices of public equities around the world,
has been particularly pronounced in the technology sector.
The expectation for the 2023 calendar year is a further
significant slowdown driven by high inflation, monetary
tightening, and low consumer and business confidence.
Slowing economic growth compounds global inequality, which
has worsened since the pandemic – undermining social
cohesion, happiness and stability. Companies that address
societal needs, like Naspers, have an important role in
reducing inequality.
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NASPERS
Integrated annual report 2023
37
The world in which we operate continued
The rise of a tech-enabled world
Investor landscape
Tech investment activity and valuations peaked in the 2021
calendar year when significant global capital was committed
quickly on a broad range of investments. While private deal
flow slowed significantly in the 2022 calendar year, we believe
our focus remains true – we are confident that disciplined
investment in exceptional entrepreneurs with outstanding
tech-led businesses positions us to create long-term value.
Significant downturn in tech investing
According to PitchBook and based on calendar years, global
venture investment plummeted in 2022 to the levels of 2017.
Public market valuations also fell significantly. However, in
contrast to panic selling at the onset of the pandemic in 2020,
the sell-off in 2022 was orderly, with relatively lower volatility.
Further downside is possible – particularly as the effects of
the economic slowdown are felt, and companies revise
earnings estimates down. Importantly, although an all-out
global war is unlikely, escalating geopolitical tensions could
disastrously impact markets.
Technology is at the heart of transformation and tech titans,
such as Amazon, Google and Microsoft, surged in value
during the pandemic. The recent experience of mega-cap tech
companies echoes the experience of many across the tech
landscape. All have confronted slowing growth and reduced
profits as the economic environment put pressure on their
businesses. Many announced layoffs (albeit small compared
with their overall workforce). However, the changes evident in
recent years are foundational and expected to endure.
The way we live our lives, the way companies operate and
market their products – people and businesses are relying
more on technology.
A worldwide crackdown on big-tech
While the technology sector has significant growth potential,
challenges remain given the world’s increasingly critical and
political view of the sector. Accordingly, regulation is growing.
This is normal – historically, all new sectors have faced greater
oversight as they grew. Broad technological advancements
pose significant challenges for regulators who strive to
maintain a balance between fostering innovation, protecting
consumers, and addressing the unintended consequences of
digital disruption at scale. Globally, regulators must balance
their responsibility to protect citizens with encouraging
innovation in new technologies and businesses while avoiding
the risk of overregulation.
Private funding rounds* (US$'bn)
100
80
60
40
20
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* Tech companies, excluding China, only including funding rounds with announced amount; excluding debt, secondary, unspecified rounds and companies out
of business.
Source: Naspers tech company database, PitchBook, CB Insights.
Against this background, we will remain a disciplined
technology investor, creating sustainable value in our own
distinctive way.
Responding to the trends
In the past year, the world has been shaped by powerful
macro, geopolitical, technology, regulatory and investor forces
that have been challenging for all.
Despite the challenges, we remain focused on improving lives
through technology and well positioned to capitalise on
opportunities in this time of dislocation. We are prudent,
focused and have an operator’s advantage in assessing and
optimising investments. Our global network is strong and our
differentiation as patient, company-building capital is
distinctive. We have well-established businesses in our
portfolio as well as assets that can provide meaningful capital
as we need it.
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Choosing the right opportunities
and balancing risks
As we develop our businesses and grow value sustainably, we understand the importance
of effective risk management and therefore continue to foster our governance processes.
These support us in setting the right objectives while identifying and managing related
risks, as well as any additional opportunities to exceed our plans.
Monitor
Action
Assess
Decide
Avoid
Optimise
Accept
Mitigate
Control
Continuous evaluation process: Our governance
processes and operating procedures ensure a structured
and systematic approach to assess and prioritise
identified opportunities and risks, decide on an
appropriate risk treatment response, operationalise our
decisions, and then monitor and re-evaluate risks and
opportunities continuously. This iterative process enables
us to make informed decisions to allocate resources
effectively, continuously evaluate ongoing appropriateness
of decisions, and ensures we are well prepared to
navigate the evolving business landscape.
Experienced, diverse leadership: Our board,
committees and management team have extensive
experience and expertise in various industries, enabling
them to make well-informed decisions and effectively
manage risks. Their diverse backgrounds and perspectives
contribute to a comprehensive understanding of the risks
and opportunities we face, ensuring we remain agile and
responsive to the changing business environment.
Adaptability and resilience: We pride ourselves on our
ability to adapt to changing circumstances and capitalise
on emerging opportunities. Our organisational structures
enable a proactive approach to risk management,
allowing local businesses to respond quickly to
unexpected opportunities as well as risks, ensuring we
remain resilient and well positioned for growth.
40
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Integrated annual report 2023
The risks we assume, how we respond to those, and how
combined assurance is applied to our desired risk profile
are discussed regularly at the board. This is done in line
with generally accepted frameworks and good practice,
including King IV.
No business can be conducted without accepting risk. As such,
our strategies may present both familiar and new exposures that
could affect our success. In the spirit of good entrepreneurship,
we accept risks responsibly, balancing risk for reward. We aim to
reduce undesirable risk exposures by implementing and
operating cost-effective risk treatment plans and/or controls.
We believe that doing so intelligently will deliver sustainable
value growth and protect against avoidable loss. Depending on
the type of risk (strategic, internal operational and external), our
philosophy is broadly outlined as follows: strategic risks we seek
to understand and accept responsibly to realise a balanced
return; internal operational risks we aim to control to the extent
that we optimise our risk profile benefiting our tolerance; and
external, non-controllable risks we aim to reduce and mitigate as
far as economically sensible.
» Strategic risks – that stand in the way of successfully
delivering on our strategic priorities and realising the desired
return on allocated capital – we may accept as we are
confident that we understand and stay close to our markets,
changes in the regulatory environment and the global
economic and geopolitical landscape. This allows us to react
rapidly should circumstances dictate. Our primary focus
remains on anticipating and serving the needs of our
customers in chosen markets as well as we can, and keeping
our services relevant for them in their daily lives. In addition,
we pay close attention to our stakeholders’ needs and
expectations by, among others, incorporating sustainability
considerations in our decision-making and engaging in open
conversations with shareholders, regulators and other internal
and external stakeholders. We have structured our
organisation to be agile and responsive to unexpected
developments, emerging risks and opportunities, and to
promote the same in our businesses. We have large stakes in
businesses and listed entities that, due to their size, are major
contributors to our results and net assets, but which we do not
control. However, we stay close to these assets, enabling our
continued belief in their potential and management. We are
confident that our combined team is strong and well
equipped to deliver and deal with challenges on the way.
Lastly, our diversified portfolio of assets and businesses
reduces our vulnerability to strategic risks.
» Internal operational risks – that would cause avoidable
Key topical risks and opportunities
Geopolitical tension has caused stress on the global
economy and capital markets, significantly increasing the cost
of capital. We expect the business environment to remain
challenged for the foreseeable future and further escalations
cannot be ruled out, demanding a prudent stance to investing.
We cannot control these risks but we monitor developments and
focus on further growing the value potential of our portfolio while
operating at leanest cost. At the same time, we continue our
mission to reduce the discount to net asset value, partly through
our open-ended repurchase programme. Our strong balance
sheet and cash position positions us well and we may be able
to identify attractive investment opportunities as valuations have
generally come down.
Natural disasters, extreme weather events and failure to mitigate
climate change are among the world’s top 10 risks, according
to the latest Global Risks Report 2023 from the World Economic
Forum. Climate considerations are therefore becoming a core
part of investment decisions across capital markets and affect
our access to capital.
(opportunity) cost or threats to the value of our reputation and
brands, including failures to comply with laws and regulation,
and unethical behaviour (including fraud) – we reduce and
control to acceptable levels by:
– Upholding our code of business ethics and conduct.
– Implementing organisational structures with clear roles and
responsibilities.
– Maintaining policies and standard operating procedures.
– Implementing the right support systems.
– Effective operational, financial and IT (cyber) controls.
– Applying suitable reporting and processes that allow
us to monitor risks and respond swiftly.
– Relying on our people to behave responsibly and deliver
what is expected from them. In managing and developing
our diverse talent pool, we keep that front of mind. We
promote a healthy culture that encourages (and rewards)
good performance and in which people feel safe and are
encouraged to speak up.
» External risks – that may cause harm and damage by events
beyond our control, including natural or manmade disasters,
pandemics, social unrest, and (cyber) crime, as well as
counterparty and capital markets risks – we reduce and
mitigate by:
– Implementing protective measures (eg restricting physical
and logistical access).
– Transferring and reducing risk through contractual
arrangements.
– Managing our balance sheet well.
– As far as economically sensible, procuring financial
products that provide loss protection (eg forward contracts
and insurance).
– Managing credit and counterparty risk closely to be able to
accept the right level of risk for our business. The latter is
accomplished by strict policies on risk acceptance and
budgetary controls, due-diligence processes in onboarding
customers and suppliers, risk spreading, and close
monitoring.
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Choosing the right opportunities and balancing risks continued
Climate-related physical risks that arise from operating in
increasingly unpredictable and extreme weather conditions are
specific to locations where we have an extended physical
footprint of our operations. As a group of digital platform
businesses, our exposure to the physical risks (our physical
footprint) is limited as we are asset-light and do not have
dependencies on natural resources for the manufacturing or
delivery of our core products and services.
Out of our entire span of businesses, it is largely our Food
Delivery and Etail segments that have physical infrastructure as
part of their business models. As weather conditions like extreme
heat become normative in communities where there is
inadequate infrastructure to deal with the impact of the extreme
weather our operations could be impacted. However, our
location-based assessment of the exposure to physical risks
presented by changing climate and weather conditions across
our businesses remains low. Please refer to our environmental
programme for an overview of climate-related physical risk
assessment across our majority-owned companies and our
mitigation actions.
Climate-related transition risks such as emerging regulations
and changing consumer preferences can have an impact on a
company’s commercial performance. The digital nature of our
businesses with a correlating low carbon footprint limits the risk
of financial impact from climate regulations that tax greenhouse
gas emissions. We further mitigate this risk through our efforts on
the decarbonisation of our operations.
We do have an exposure to reputational risks related to the
environmental impact of our Etail and Food Delivery segments
due to the use of fossil fuel-based delivery vehicles and
packaging. We are currently working with our companies to
deploy programmatic solutions to transition to electric vehicles
and sustainable packaging to solve these emission hotspots.
Sustainability reporting requirements like CSRD are increasing
significantly and pose additional compliance challenges.
Specifically, in context of our group of companies that largely
operate outside of the European Union where there can be
lower maturity and lower expectations on ESG reporting, we
believe that there is a risk that our companies are penalised for
not having already achieved the results on ESG performance of
European companies. The current reporting frameworks reward
results, not transition and intent. Our companies that are mostly
private are at a disadvantage as they have yet to build out their
ESG disclosures to the level of mature European ESG
counterparties which is expected by the upcoming disclosure
regulations. There will be a need for internal dialogue on
prioritisation of resources, towards ESG disclosures, versus the
path to profitability.
We have a strong commitment to transparency and to raising
awareness about this deep divide between companies that
have mature ESG disclosures to those that are starting on that
journey.
Like many of our peers, we have reduced cost and headcount.
The impact of these necessary actions weighs on our staff. While
we find new ways of working and organising ourselves to be as
efficient as we can be, the risk of unexpected operational issues
and reduced morale from strained resources is currently
heightened. This is amplified by a global shortage of talent,
especially in technology. We are strongly committed to the
wellbeing of our staff. By creating the right inclusive environment
for them to thrive and feel recognised, and by offering
competitive compensation, we aim to grow a stronger workforce
and gear up for success.
Globally, we observe technology developments continuing to
happen rapidly. We stay on top of these, such as in data and
generative AI, to early identify any emerging risks and ensure
responsible use of data and related technologies to keep our
customers safe. Equally, we stay focused on opportunities to
further develop and adopt tech advances to improve our
products and services. Cyber and information security remain
key aspects and focus areas.
Material matters
Associated risk
Financial
performance
Responsible
investments
We accept risks responsibly, balancing risk for reward. Strategic risks we seek to understand and accept responsibly to realise
a balanced return; internal operational risks we aim to control to the extent that we optimise our risk profile benefiting our
tolerance; and external, non-controllable risks we aim to reduce and mitigate as far as economically sensible.
In recent years, investors’ awareness of ESG issues, such as climate change, pushes them to invest in funds that benefit society
and generate returns. The continued focus on ESG performance scores will mean businesses that do not meet certain
ESG-based criteria will not attract investment.
Our capital-allocation disciplines underlying our investment strategy may not deliver the (above-average) sustainable return
our investors seek for the risk they perceive. We may not find investment opportunities that fit our strategy and deliver an
expected return above our cost of capital. Portfolio risk may prove higher than we assumed to accept, which could negatively
impact the internal rate of return and lead to a decline in the valuation of Naspers.
Refer to the sustainability review to understand how we manage our performance on this material matter.
People
Global shortage of high-calibre (digital) talent.
Employees are actively seeking employers that reflect a higher sense of purpose and they choose to be part of a company
that contributes positively to society.
Non-compliance with applicable occupational health and safety, as well as labour and economic empowerment laws.
Refer to the people section to understand how we manage our performance on this material matter.
Digital
inclusion
Digital inclusion is a global risk and prevalent in the countries in which we operate. As a global technology investor and
operator, we are exposed to markets where information and communications technology (ICT) is slow to develop, and uptake
as well, due to specific in-country constraints.
Refer to the digital inclusion section to understand how we manage our performance on this material matter.
Innovation
Our strategy for digital services places particular focus on software-led innovation. Failure to properly protect and enforce our
businesses’ IP rights against any unauthorised use or infringement by third parties may lead to loss of market share, revenue
opportunities and reputation.
Business
culture, ethics
and integrity
Community
investment
AI
Refer to the innovation section to understand how we manage our performance on this material matter.
Unethical behaviour in breach of our code of business ethics and conduct.
Loss of consumer trust, for example failing to deliver on our service promise, data security breaches, non-compliance and
inferior product offerings.
A listed company is expected to demonstrate responsible business conduct in line with stakeholder expectations of its ability
to impact and be impacted by material issues. Lack of transparency and information in the public domain on topics important
to stakeholders can cause reputational damage.
Non-compliance with laws and regulations in the countries where we operate, specifically company law, data privacy,
anti-bribery and anti-corruption, taxes and duties, licence conditions, consumer protection, anti-money-laundering and
international sanctions.
Refer to the business culture, ethics and integrity section to understand how we manage our performance on this material
matter.
Infringement of human rights contrary to the group’s human rights statement.
Refer to the upholding human rights section to understand how we manage our performance on this material matter.
Perception of inaction on community investments for social impact can lead to reputational damage.
Refer to the community investment section to understand how we manage our performance on this material matter.
We are increasing our investments in online service platforms and data-driven technologies, which results in heightened risk of
technology obsolescence or falling short in building AI/ML solutions for our service and product offering.
Refer to the artificial intelligence section to understand how we manage our performance on this material matter.
Cyber-
resilience
Our systems and the data they store are subject to various IT security threats, which target sensitive information, integrity and
continuity of our services and the reputation of our businesses.
Ineffective response, including insufficient innovation, to meet our customers’ changing demands and consumption patterns.
Refer to the cyber-resilience section to understand how we manage our performance on this material matter.
Data privacy
A failure in or breach of our operational or security systems or those of third parties with which we do business could disrupt
our businesses, result in the disclosure or misuse of personal, confidential, or proprietary information, damage our reputation,
increase our costs and cause losses.
Refer to the data privacy section to understand how we manage our performance on this material matter.
Climate
action
Climate-related physical risks from operating in increasingly unpredictable and extreme weather conditions are specific to
locations where we have an extended physical footprint of operations.
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Climate-related transition risks such as emerging regulations and changing consumer preferences can have an impact on a
company’s commercial performance.
o
n
Refer to the climate action section to understand how we manage our performance on this material matter.
Path to profitability
We have a long history of investing and building businesses,
then crystallising value.
It is in our DNA to look for new opportunities, see the potential
others are not seeing and then to do the hard work of
building, bringing businesses to scale and profitability. This is
the case for our Ecommerce portfolio, which houses our core
growth segments: Food Delivery, Classifieds, Payments and
Fintech, and Edtech.
As expected, FY23 marked the peak of our investment in
ecommerce, with profitability and cash flow generation
improving from this point. We are well on track to deliver our
goal for aggregate profitability (illustrated below) during the
first half of FY25. Our strong balance sheet and significant
liquidity are key advantages in the current climate,
underpinned by our disciplined approach to M&A and
commitment to maintain our investment-grade rating.
Significant progress since listing Prosus in 2019
Ecommerce scaling fast
Consolidated revenue CAGR loss of US$156m
Structural improvement
Doubled Prosus’ free float
Built valuable growth extensions
Continued investment of US$492m in high
conviction growth areas in groceries, credit
and Edtech
Enhanced disclosure
Financial and remuneration reports
Scaled core profitability
Core Classifieds, Food Delivery and Media are
profitable, core Payments and Fintech is almost
at breakeven
Strengthened shareholder engagement
Value creation, structural action, compensation,
sustainability
Strengthened balance sheet
Issued US$10bn bonds at attractive rates, net
cash position
Unlocked value for shareholders
US$20.6bn shares repurchased since 2020
With more to come
We have grown our business over the past three years.
Revenue (US$’000)1
6
5
4
3
2
1
0
5.7
23%
CAGR
3.1
Ecommerce
3.0
2.5
2.0
1.5
1.0
0.5
0.0
2.7
16%
CAGR
1.8
1.4
0%
CAGR
0.5
0.5
64%
CAGR
0.3
0.9
33%
CAGR
0.4
Classifieds, excluding
OLX Autos and Ukraine
Food Delivery
Payments and Fintech
B2C
●
March 2020
●
March 2023
New
segment
0.1
Edtech
1 Results of majority-owned and managed businesses. This excludes results from associates and joint ventures. The segmental view excludes Movile, which is included
in Ecommerce. Growth percentages represent three-year revenue compound annual growth rate (CAGR).
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India
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Integrated annual report 2023
India forecast to
be the fastest-
growing economy
in 2023
Highlights
2023
Population
1.4 billion
Unemployment rate
7.8%
GDP
7%
Inflation
6.8%
2026*
Fintech market
US$5tn to US$6tn
BNPL (buy-now/pay-later)
35% >US$80bn
Retail digital transactions
28% CAGR
Smartphone penetration
81%
* Estimated.
Naspers offers
» PayU: Secure, tech-based banking services
nationwide – convenience, personalisation,
transparency, accessibility and ease of
use.
» PayU aim: Holistic financial services
provider for India. Vision: Market-leading
digital financial ecosystem in India with
a strong value proposition to merchants,
consumers and banks.
» PayU connects consumers, merchants
and banks:
1
2
3
Merchants
Integrated payments platform for
merchants across categories
Processed >two billion transactions
in FY22
Consumers
Digital banking and credit for the
Indian mass market
In India, we have built an ecosystem
around merchants with the PayU
payments solution, around consumers
with LazyPay and PaySense, and
around banks with Wibmo
Banks
Offering payment infrastructure for
financial institutions
Partnership with ~200 banks in India
and expanding internationally
» PayU first to launch BNPL product
with LazyPay.
» Compliant with new regulations:
Customer protection and conduct,
disclosure of key fact statement,
customer education, product structuring,
disclosures and processes.
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Food Delivery1
Operational performance
Key statistics
Free cash flow
-US$141m
(FY22: -US$277m)
Capital expenditure
-US$9m
(FY22: -US$7m)
Number of employees
5 210
Stakeholder material matters
Employees: Career development, business
performance
Drivers:
Job opportunities
» Looking after our drivers
Skills development
» Education
Customers (restaurants):
Converting consumers to online food delivery
» Economic growth
Consumers:
Additional and affordable convenience,
eg grocery delivery
» The opportunity – user experience
Strategic focus
Expand the total addressable market while
increasing profitability. We are applying the
successful full-service (1p) model to other verticals:
» Unlock addressable market by developing
capabilities for adjacencies
» Drive higher engagement
» Ability to reinvest profits
» Improve unit economics
Risks
» Differing pace of growth across geographies
» Regulatory changes
» Cyber-resilience
Value drivers
» Increase order frequency through loyalty
» Expansion to mass market
» Organically grow monthly unique buyers
» Additional adjacencies (quick commerce, logistics
services, fintech and etail)
» AI and data science
» Managing costs and delivering efficiencies
Expanding the food opportunity
As economies of scale unfold, our Food Delivery portfolio
companies delivered strong growth. Total gross merchandise
value (GMV) grew 18% (27%) YoY, translating into US$4.2bn or
40% (44%) growth in revenue2. This is over fivefold higher than
revenue generated in FY20.
Given the growing importance of convenience in people’s
daily lives, the food-delivery opportunity is proving broader
than envisaged. Grocery delivery offers an appealing
consumer experience and is a natural adjacency to core
restaurant food delivery. The group is currently exploring
various 1p and 3p models to enhance the unit economics
of these businesses. The segment’s grocery-delivery and
quick-commerce businesses grew GMV by 18% (14%). Our
three main food-delivery portfolio companies, iFood, Delivery
Hero and Swiggy, continue to capitalise on these trends by
building grocery-delivery businesses on their existing
platforms.
Two of our portfolio companies now run profitable core
restaurant food-delivery businesses (iFood) or positive adjusted
EBITDA (Delivery Hero, excluding Glovo). With an increased
focus on profitability and scaling adjacencies, the segment’s
trading losses improved from US$724m in FY22 to US$649m
in FY23. We are confident that our food-delivery businesses
will be significantly profitable and continue to offer long-term
growth. Underscoring this confidence, we recently took full
control of iFood for €1.5bn (about US$1.6bn) plus a contingent
consideration of up to a maximum of €300m at a future date.
The opportunity
We identified food delivery early as an attractive long-term
investment for the group. Four key factors underpinned our
confidence:
» Large total addressable market (TAM): The revenue TAM
for online food delivery is expected to double by 2026
(US$95bn in 2021), while the category ‘global restaurant
and grocery’ is projected to generate almost US$320bn in
revenue by 2026. The online food-delivery portion
will continue expanding on the back of secular tailwinds,
including rising smartphone penetration, urbanisation,
growing disposable incomes, and the shift to outsourcing
everyday services. In addition, establishing our presence
in ‘global restaurant and grocery’ gives us a competitive
advantage (consumers, data and logistics) that unlocks
adjacencies (eg logistics services, fintech, etail and more).
1 In presenting and discussing our performance, we use certain alternative performance measures not defined by IFRS, referred to as non-IFRS-EU financial measures,
alternative performance measures or APMs. Such measures include economic-interest-basis information; trading profit; adjusted EBITDA; headline earnings; core
headline earnings; and growth in local currency, excluding acquisitions and disposals. Segmental reviews in this report are prepared showing revenue on an
economic-interest basis (which includes consolidated subsidiaries and a proportionate share of associated companies and joint ventures), unless otherwise stated.
Numbers included in brackets represent the equivalent measure on the basis of growth in local currency, excluding acquisitions and disposals. For further explanation of
the use of APMs, refer to about this report in the governance section.
2 Presented on an economic-interest basis.
48
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Revenue2
US$4.2bn
(2022: US$3.0bn)
Trading loss2
US$649m
(2022: US$724m)
» Low online penetration with room for growth: A tech-
enabled paradigm shift is underway in dining habits, as
more and more meals are delivered rather than home-
cooked or consumed in restaurants.
» Compelling user behaviour: Given high-frequency use
patterns and the growing importance of convenience in
daily lives, we have built strong relationships with
consumers, knowing that the same consumer who orders
restaurant delivery likely wants grocery delivery as well.
At the same time, we have built great relationships with
restaurants and merchants, enabling us to convert more
consumers to online food and grocery delivery while serving
the needs of restaurants and merchants more holistically
through supply, fintech and logistics services.
» Hyperlocal operations: While the online food-delivery
market presents a massive opportunity globally, its form and
pace of growth differ considerably across geographies.
Regional markets develop at a locally dictated pace
depending on cultural and structural differences as well as
urbanisation dynamics that influence consumer demand.
The impact and effects are hyperlocal and this fits Naspers’
philosophy of partnering with local entrepreneurs who
deeply understand their markets. Our exposure to growth
markets also gives us underlying tailwinds, as population
growth and economic momentum drive the sector.
Building a global leader in food delivery
A leading position in
57 markets
Covering
>70 countries
>US$10bn invested
Source: Company information – based on direct investments: Delivery Hero
(56 markets), iFood (Brazil).
We are building a global leader in on-demand food delivery.
We are present in more than 70 markets through three core
platforms – iFood, Swiggy and Delivery Hero and several
smaller investments in earlier-stage opportunities.
In November 2022, we bought out minority shareholders in
iFood to make it a wholly owned subsidiary.
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49
Food Delivery continued
iFood
In FY23, Brazil’s rising inflation and unemployment rates
created a challenging macroeconomic environment for iFood,
affecting consumer confidence and reducing discretionary
spending on dining out and food delivery. iFood grew revenue
39% (35%) to BRL7.1bn (US$1.4bn), driven largely by shifting
consumers to larger average basket sizes, an increase in
monthly unique buyers, changes in pricing and the growth of
the quick-commerce/grocery-delivery business. iFood’s orders
increased 10% (7%) to over 832 million and GMV grew 27%
(20%) to BRL48bn (US$9.4bn). Trading loss reduced by
US$127m to US$79m (on an economic-interest basis), as
increased scale led to improved margins in the core
restaurant food-delivery business that is now profitable, which
were partially offset by investment in the grocery marketplace,
quick-commerce and fintech extensions. During the year,
iFood’s trading loss margin improved by 15 percentage points.
Three-year snapshot of growth: 2020 to 2023
Trading loss reduced 68% to
US$79m
Total number of orders for Brazil
>832 million
Average order value as of March up 44% to
BRL59
The significant overlap between customers of restaurant
delivery and grocery delivery, coupled with operational
synergies across these businesses, make grocery delivery
a natural fit for the iFood ecosystem. The iFood grocery
business has quickly become an important participant in
Brazil’s significant US$55bn grocery industry (2022 Euromonitor
estimate). In FY23, iFood’s grocery and quick-commerce
businesses delivered over 43 million orders (+2% YoY) and
BRL4.5bn (US$0.9bn) of GMV, +18% (+14%) YoY. Investment to
realise this opportunity recognises the broader context and
higher cost of capital, and is disciplined with a focus for a
clear path to profitability.
As the most-loved brand in Brazil, iFood also keenly understands
the importance of earning its so-called licence to operate in
the local social context. Aligned to its purpose to feed the
future of the world, key initiatives underpinning the iFood
approach are summarised alongside.
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Playing an essential part in Brazilians’
everyday lives
iFood wants to play an increasingly essential part in
Brazilians’ daily lives. To do so, in FY23, it focused on
strengthening its ecosystem and increasing sustainability
in education and the environment. Specific initiatives are
summarised in the sustainability review.
More than
1 500 Brazilian cities covered
Around
75 million orders in March 2023, including
restaurant and grocery
36% own-delivery orders
>330 000 merchant partners
10% iFood order growth
27 million 1p (logistics) business orders in
March 2023
Strengthening the iFood ecosystem
iFood continued adding new solutions and strengthening
its ecosystem throughout FY23. Leveraging its existing and
valuable assets, and layered in technology, it is possible to
shorten the path to profitability of new businesses. Beyond
scaling and consolidating its grocery-delivery and quick-
commerce businesses, iFood is building a fintech environment
around its platform to expand its ecosystem, including meal
vouchers and credit for restaurant partners.
» Scaling grocery delivery and quick commerce: By year-end,
iFood Brazil delivered over 43 million grocery orders from
over 29 000 stores across nearly 900 cities, representing
order growth of 2% YoY.
» New financial service offerings gained traction:
– iFood processed BRL872m of online payment revenue,
while MovilePay processed 27% of iFood’s payouts.
– Bank for restaurants (loans, credit card, insurance): Over
BRL355m in assets under management, and more than
3 700 loans issued.
– Meal vouchers and multibenefit cards: Over 630 000
cards issued covering more than 4 000 companies.
Swiggy3
Following a complete recovery post the initial impact of Covid-19
in 2020, Swiggy’s core restaurant food-delivery business grew
26% in GMV4 YoY in FY23. Its quick-commerce business,
Instamart, continued to expand fast, generating GMV growth of
459% YoY. In FY23, Swiggy also focused on its profitability
journey, which is reflected in its financial performance.
In the past two reporting periods, Swiggy has concentrated
on reactivating users, increasing monthly frequency and
improving user conversion. The benefits are evident in its
results for FY23, with over 272 000 enabled restaurants on its
platform, 155% of pre-Covid-19 levels, and GMV of US$2.6bn.
Our share of Swiggy’s revenue was US$297m (FY22: US$212m),
up 40% (73%) from the prior year, driven by higher average
order values and higher revenues from delivery fees and
advertising sales. Swiggy is expanding its Instamart business,
which doubled the number of enabled stores on its platform
in 2022. This resulted in accelerated growth in the groceries
business, coupled with continued growth in the restaurant
food-delivery business.
Swiggy is currently engaged in restaurant food-delivery,
quick-commerce, concierge services (Genie) and other
convenience offerings, serviced through its network of around
374 000 delivery partners. In FY23, the company expanded
into the dining-out space by acquiring Dineout, a leading
dining and restaurant tech solutions platform in India,
enhancing its portfolio of consumer convenience offerings.
Swiggy has also launched an innovative subscription
programme, Swiggy One, a multicategory loyalty programme
across its restaurant food-delivery, quick-commerce, Dineout
and concierge services.
Swiggy is well funded to capitalise on recent momentum and
well positioned to improve its platform’s competitiveness by
investing in product and technology.
Delivery Hero
As anticipated, Delivery Hero’s platform business (excluding
Glovo) generated positive adjusted EBITDA in 2022. This
continues the trend of strong YoY growth, organic investment
in quick commerce and pursuing value-accretive M&A
opportunities. For the year to 31 December 2022, Delivery
Hero reported GMV of €44.6bn with 18% YoY growth.
Our share of Delivery Hero’s revenues and trading losses was
US$2.4bn (2022: US$1.8bn) and US$267m (2022: US$343m)
respectively.
By end-December 2022, Delivery Hero operated over
1 137 Dmart stores (small Delivery Hero-owned warehouses in
strategically relevant locations for quick-commerce delivery),
catering to evolving customer needs with an increased focus
on convenience and speed of delivery. The success of the
Dmart concept among customers is reflected in seven
best-in-class countries already being at breakeven at the
beginning of 2022.
Looking forward
iFood, Swiggy and Delivery Hero – our core food-delivery
assets – are leading businesses in their regions with
plenty of room to grow, both in scale and in the breadth
and depth of their ecosystems. We will continue to invest
organically, while remaining focused on profitability, to
improve the core restaurant food-delivery offering and
expand the total opportunity by building scaled
capabilities in quick commerce and grocery, and
additional adjacencies in the food-delivery ecosystem.
We aim to play an ever-increasing part in leading the
food-delivery revolution for consumers, restaurants and
delivery partners around the world.
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4 GMV includes delivery fees.
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51
Classifieds1
Operational performance
Number of employees
4 500
Key statistics
Free cash flow
-US$314m
(FY22: -US$360m)
Capital expenditure
-US$24m
(FY22: -US$25m)
Stakeholder material matters
Employees: Job security, career development,
and competitive benefits
Customers: Trust, safety and convenience
Strategic focus
» Accelerate profitability to reach best-in-class
industry margins
» Leveraging services to capture monetisation
upsides
» Scaling pay-and-ship capabilities to enhance and
expand goods category
» Differentiating through category-specific user
experience and services
» Enabling faster innovation through technology
and data
Risks
» Macroeconomic trends in key markets
» Rising inflation, higher interest rates affecting
consumers’ disposable income – these
particularly affect real estate and cars, but
present an opportunity for used goods
Value drivers
» Faster execution due to improvements in
platforms and added services
» Growing monetisation of pay-and-ship
Profitable growth and scaling new capabilities
Intensifying strategic focus
The OLX vision is to build leading marketplace ecosystems,
enabled by tech, powered by trust, and loved by customers.
By going beyond the traditional classifieds-ads model, OLX is
supporting end-to-end-user journeys, and scaling businesses that
leverage each other’s assets and strengths.
Operating metrics across our core Classifieds business3 remained
stable, with 73 million active listings (FY22: 73 million), 45 million
monthly active app users (FY22: 44 million) and 1.8 million paying
listers (FY22: 1.8 million), despite a challenging year given the war
in Ukraine, a shift in financial markets and a pronounced
slowdown of the used-car market. OLX responded fast by
intensifying its focus on customers and executing key projects for
long-term value creation, while investing to improve efficiencies.
The core classifieds business in OLX is profitable, cash flow
positive and fast-growing.
Naspers divested its Russian online marketplace, Avito in
October 2022 for proceeds of US$2.4bn.
More recently, OLX Autos, our adjacent autos transaction business,
was affected by ongoing macroeconomic and market challenges,
similar to listed peers. Higher cost of capital, high inflation and the
reversal of pandemic trends led to a significant and persistent
slowdown in the second-hand car market.
Accordingly, in March 2023, we announced the decision to exit the
autos transaction business. We continue to explore strategic
options, such as selling all or parts of the portfolio.
The operations of this business classified as held for sale and those
that have been closed down by 31 March 2023 are presented as
discontinued operations. The OLX Autos operations still included in
continuing operations are those whose exit process has not been
finalised by 31 March 2023. These are expected to be discontinued
in FY24 as the group works through the process quickly and
efficiently in the interests of all stakeholders.
While OLX Autos has built leading positions across many of its key
markets, given its strong technology platforms and local focus,
pursuing a global growth strategy is no longer the right approach
for our shareholders.
Our core Classifieds business
The core classifieds business of OLX Group continued to deliver a
strong performance in the financial year, with sustained growth
and improved profitability. It is well placed for further growth and
margin expansion.
Excluding the impact of the war in Ukraine, OLX Europe continued
to deliver strong progress in FY23, recording 22% revenue growth
on an economic-interest basis, and in local currency, excluding
M&A. Trading profit grew by US$38m to US$83m on an economic-
interest basis, representing a margin improvement of 3%
compared with last year.
1 In presenting and discussing our performance, we use certain alternative performance measures not defined by IFRS, referred to as non-IFRS-EU financial measures,
alternative performance measures or APMs. Such measures include economic-interest-basis information; trading profit; adjusted EBITDA; headline earnings; core
headline earnings; and growth in local currency, excluding acquisitions and disposals. Segmental reviews in this report are prepared showing revenue on an
economic-interest basis (which includes consolidated subsidiaries and a proportionate share of associated companies and joint ventures), unless otherwise stated.
Numbers included in brackets represent the equivalent measure on the basis of growth in local currency, excluding acquisitions and disposals. For further explanation of
the use of APMs, refer to about this report in the governance section.
2 Presented on an economic-interest basis.
3 Excluding OLX Autos markets.
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Revenue2
US$1.6bn
(2022: US$1.3bn)
Trading loss2
US$156m
(2022: US$70m)
In the goods category, enhanced competitiveness improved
performance, and our pay-and-ship service increased buyer
adoption significantly while improving monetisation and the
trading profit margin. In the jobs category, the launch of a
candidate section and applicant-tracking system increased
user engagement and monetisation in Poland.
In European autos, we increased revenue per insertion and
number of monthly listers. We are also improving the car-parts
user experience, leading to growth in insertions and listings
on our dedicated autos platform in Poland.
In real estate, our redesigned commercial offering encouraged
more professional sellers to select our bundled and value-added
services. The teams also developed an innovative data-as-a-
service product – a suite of ML-enabled analytical tools for
professional sellers. Average revenues per insertion grew,
reflecting the appeal of the new commercial offering and
new product features.
Trust and safety remain critical. A series of product improvements
led to 835 000 fewer malicious views, and a reduction of around
9% bad ads per month. We have also made significant progress
in becoming compliant with the Digital Services Act that will
become effective in Europe in February 2024. The aim of this act
is to create a safer digital space where the fundamental rights of
users are protected and to establish a level playing field for
businesses.
Given prevailing macroeconomic conditions, we reduced our
workforce by 15% in January 2023, creating a leaner organisation
that can better compete in the global tech market. These measures
stabilise our positioning for the future while accelerating our
path to profitability as OLX Group.
Continuing to rebuild our Ukrainian business
The ongoing war in Ukraine is having a massive impact on
its society and economy, including high inflation, currency
devaluation, and a contraction of the economy. Despite this, our
Ukrainian platforms and teams have demonstrated exceptional
resilience. After an initial drop in all metrics in the early months
of the war, the platform is recovering, with daily active users
back to 94% of pre-war levels.
Looking forward
Our focus for FY24 and beyond is to continue evolving
as a leading classifieds player, enabling platform
transactions and category-specific shopping experiences
by executing a well-defined strategy:
» Accelerating profitability to reach best-in-class industry
margins: We have streamlined our portfolio to focus on
core Classifieds, restructured our workforce and grew
advertising revenue to drive higher margins.
» Leveraging our services to capture monetisation upsides:
We have invested in building and enhancing the
products and services we offer to our customers in our
key markets and categories. We will continue to
monetise the increasing value we are delivering to our
customers.
» Scaling pay-and-ship capabilities to defend and
expand goods category: We continue to transform from
a traditional classifieds model into a transactional
marketplace, with best-in-class experiences focused on
safety and convenience. In FY23, we scaled pay-and-
ship across our key markets and we are improving its
economics.
» Differentiating through category-specific user
experience and services: Jobs and services have
organically become sizable categories. We are adding
value for our users by building more category-specific
user experiences and services.
» Enabling faster innovation through technology and data
In coming years, we will continue to unify our products
across categories to accelerate time to market,
compete effectively and reduce the cost of technology.
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53
Payments and Fintech1
Operational performance
Scaling credit in India
The Payments and Fintech segment continued to benefit from
the shift to digital payments. On a consolidated basis, the
core PSP business and credit drove PayU’s revenue growth of
32% (52%) to US$903m. The trading loss, on an economic-
interest basis, was US$83m (FY22: US$46m), at a negative
margin of 9% (FY22: -7%) due to a once-off loss provision of
US$23m. Excluding this provision, the PSP business remained
profitable.
The core PSP business delivered revenue growth of 23% (43%)
to US$790m, driven by transactions and total payments
volume (TPV) growing 19% and 24% (39%) to 2.7 billion and
US$98bn respectively. While both India and Global Payments
Operations (GPO) grew revenue solidly, the core PSP business
reported a trading loss of US$2m, mainly due to GPO’s
once-off loss provision. Excluding this loss provision, the core
PSP business generated a 3% trading margin, down from 4% in
FY22, as GPO incurred higher merchant acquisition costs and
invested in building new products.
India’s TPV grew 33% (44%) to US$58bn, driven by transactions
growth of 25% to 1.4 billion. India is the largest market in our
payments business and contributed 51% of the core PSP
business’ revenues, up from 47% in FY22. India generated
US$399m of revenue, which grew 31% (42%), driven by
continued growth in enterprise and small and medium-sized
businesses, and diversification into newer segments, including
government merchants, omnichannel, and other non-MDR
(merchant discount rate) products. Revenue growth and
cost-saving initiatives led to a 78 basis point improvement in
trading profit margin to 3%.
Currency translation impacted the GPO business, especially
Turkey where hyperinflation continued. The GPO business grew
transactions and TPV by 12% and 13% (32%) to 1.2 billion and
US$39bn respectively, which drove revenue growth of 15%
(44%) to US$393m. Growth of global merchants, especially in
Turkey, was the main driver. Turkey, one of the largest markets
in GPO, contributed 22% of GPO’s revenues, and grew 52% in
US$ terms (154%). Increases in instalment sales and customer
mix led to an improvement in take rate in Turkey. Higher
merchant acquisition costs drove GPO’s gross profit margin
lower. GPO has taken efforts to offset this increase through
cost-optimisation efforts, including headcount rationalisation,
the benefits of which will come through in the next financial
year. PayU’s Indian credit business continued to scale, issuing
Key statistics
Free cash flow
US$29m
(FY22: -US$66m)
Capital expenditure
-US$7m
(FY22: -US$10m)
Number of employees
3 447
Stakeholder material matters
Employees: Job security, career development and
competitive benefits
Consumers: Trust and security
Strategic focus
» Supporting India’s growth: Building a financial
ecosystem around merchants, consumers and
banks by accelerating the payments and
credit offering
» Focus on profitable growth in core payments and
credit
Risks
» Macroeconomic pressure, with rising inflation
and interest rates
» Increasing volume and complexity of regulatory
requirement
» Cybersecurity
» Counterparty risks (increased credit portfolio)
» Fraud over the platforms
Value drivers
» Presence in high-growth payments markets
» Diversifying revenue base in payments
» Scaling consumer credit with a strong
governance and risk management
» Managing costs
Revenue2
US$1.1bn
(2022: US$796m)
Trading loss2
US$116m
(2022: US$60m)
India is our largest market and the country recorded an increase
of 58% YoY3 in total number of retail digital transactions in FY23,
while payment volume rose 28%. The digital payments industry is
forecast to grow at 28% between 2021 and 20264.
The credit growth outlook remains positive, with consumer
credit poised to grow at 13%5 CAGR to FY26, partially due
to growth in fintech lending, which is expected to account for
6% of total consumer credit by FY26 (estimated) (growth at
>50% CAGR).
US$742m in loans, which grew 47% and led to a loan book of
US$256m at 31 March 2023. The core credit business grew
revenue three times (three times) to US$83m, driven largely by
growth in personal loans. The trading loss of US$10m
represents a 63 percentage point improvement in margin to
-12%, reflecting an improved loss rate of 2.5% from 3% in FY22.
As a result of its closure, the India credit metrics exclude
LazyCard.
The largest Payments and Fintech investment in our associate
portfolio, Remitly, grew its send volumes 40% to US$29bn in
the year ended 31 December 2022. Our share of Remitly’s
revenue and trading loss reported was US$147m, up 35%
(43%), and US$27m, representing a negative margin of 18%.
The opportunity
Payments and Fintech is one of the fastest-growing segments
worldwide, accelerated by the move online due to the
pandemic.
We identified three key trends in Payments and Fintech, which
all play to our strengths:
» Continued acceleration of digital payments, especially in
India and Turkey.
» Continued strong demand for credit in India.
» Slowing funding for start-up ecosystems.
1 In presenting and discussing our performance, we use certain alternative performance measures not defined by IFRS, referred to as non-IFRS-EU financial measures,
alternative performance measures or APMs. Such measures include economic-interest-basis information; trading profit; adjusted EBITDA; headline earnings; core
headline earnings; and growth in local currency, excluding acquisitions and disposals. Segmental reviews in this report are prepared showing revenue on an
economic-interest basis (which includes consolidated subsidiaries and a proportionate share of associated companies and joint ventures), unless otherwise stated.
Numbers included in brackets represent the equivalent measure on the basis of growth in local currency, excluding acquisitions and disposals. For further explanation of
the use of APMs, refer to about this report in the governance section.
2 Presented on an economic-interest basis.
3 Source: RBI Payment system indicators. Retail transactions, excluding cheque-based. As of March 2023.
4 Source: RBI and NPCI data, BCG and PhonePe analysis.
5 Sources: RBI; Ministry of MSME India; Accord; CRIF; Market participant interviews; Bain analysis.
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Payments and Fintech continued
Strategic priorities
Supporting India’s growth
In India, we have built an ecosystem around merchants with
the PayU payments solution, around consumers with LazyPay
and PaySense, and around banks with Wibmo.
For merchants, PayU has built a diversified product suite
offering value-added services beyond core payments for the
different merchant segments. In FY23, we processed over
US$58bn in total payments volume, up 33% (44%) on last year.
Revenue from value-added services increased from 32% last
year to 36% this year. PayU has been scaling partnerships with
banks and other financial institutions through Wibmo. Wibmo
was acquired in 2019 and has strengthened the PayU
platform for both banks and merchants by providing payment
authentication, merchant acquiring and risk management
services.
For consumers, PayU offers solutions for transactional credit to
facilitate online commerce and cross-sells personal loans,
successfully scaling the loan book. In FY23, originations
expanded 47% and assets under management increased by
112% over last year. This scale has been achieved on the back
of effective capital and risk management.
Transaction credit drives cross-sell of other credit products and services
Discovery at a
trusted merchant
partner
In progress
Adoption through
high-frequency
transactional
credit
Offering longer
credit duration
products like
personal loans
Cross-sell other
financial services
Revenue growth1
Annualised loss rate of
personal loans
6%
3x
2.5%
Pre-Covid-19
FY23
1 Presented on an economic-interest basis.
Improvement in
profitability driven by:
» Increasing scale
» Diversification of sources of funds
» Leveraging data for optimising
loss rate
» Cost discipline
India remains a highly attractive strategic market for PayU,
given that it is expected to become the third-largest economy
by nominal GDP within the next decade.
Focus on profitable growth in core payments
and credit
In the past five years, total payment volume has increased
approximately four times (five times), growing at a CAGR of
31% (39%). The business processed US$98bn in payments
volume in FY23. It has continued investing and building new
opportunities such as credit in India. The credit business
revenue has grown nine times since FY21, translating into a
revenue CAGR of over 200%. This growth has been coupled
with cost reductions, ensuring that the trading-loss margin
continued to improve YoY and will deliver profitability in
the coming year.
Removing financial borders and enabling
broader access
As one of the world’s top investors and a leader in payments
and fintech in high-growth markets, we contribute to a more
inclusive future for finance. By building customer-centric
products and services, we enable sustainable prosperity in
our markets and communities and broaden access to finance.
This includes equipping merchants and their customers with
the latest payments solutions.
Looking forward
We will continue to scale our fintech ecosystem across
merchants, consumers and banks.
We are present in high-growth markets and we will
continue to double down on India. India is forecast
to record strong growth in both payments and credit,
and PayU is well placed to benefit from this growth by
maintaining its market position and improving profitability.
Sustainability is a key element of our positioning
as a fintech leader in high-growth markets. Our ESG
transformation roadmap is guided by our aspirational
target to enable expanding circles of positive impact
around PayU. While we have focused on the inner impact
circles in FY23, we are building momentum to drive
broader societal impact in the new year and beyond.
The future for Payments and Fintech is to become
ever-more empowering, inclusive and sustainable, to build
a world without financial borders where everybody can
prosper.
PayU: Giving access to two billion consumers
We build an ecosystem around our platform
Merchants
Consumers
Banks
Poland
Czech Republic
Romania
Turkey
Israel
India
Panama
Colombia
Nigeria
Kenya
Singapore
Peru
Brazil
Chile
Argentina
South Africa
4 continents
17 high-growth
counties
US$98bn
processed payment
volume, around 60%
contributed by India
>300 payment
methods
>130 banks
>15 licences
2.7 billion
transactions
(excluding Wibmo)
US$742m loan issuances in FY23
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Integrated annual report 2023
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57
Edtech1
Operational performance
Workforce/higher education:
Transforming education through technology
K–12 education:
Key statistics
Free cash flow
-US$132m
(FY22: -US$28m)
Capital expenditure
-US$24m
(FY22: -US$3m)
Number of employees
859
Stakeholder material matters
Employees: Talent retention. Employee wellbeing.
Company culture
Regulators: Timeous reporting
Investee/portfolio companies and associates3:
ESG. Business performance. Efficient growth
Workers, learners, educators: Data privacy.
Community development
Strategic focus
» Workforce/higher education models
» K–12 education
Risks
» Macroeconomic downturn and higher
interest rates
» New forms of competition for existing edtech
providers
» Disruption from enhancements and increased
availability of GenAI
» Limitations in software development, research
and product capabilities
Value drivers
» Demand for continuous learning and higher
levels of education
» Demand for faster upskilling
» Constraints facing traditional brick-and-mortar
education systems
Edtech is a more nascent opportunity that is still building
products and services to deliver an increasing need.
The segment grew revenue (on an economic-interest basis) by
28% (18%) to US$545m in FY234. Trading losses increased to
US$258m from US$117m in the prior year.
Our portfolio was affected by the macroeconomic downturn
which culminated in an environment where customers are
focused on reducing costs. Portfolio companies reacted fast to
changing market conditions and began to optimise cost structures
and postpone accelerated investments.
Education remains a significant and high-potential sector, with
compelling secular tailwinds such as emerging-market population
growth, improving education levels worldwide, and workforce
reskilling/upskilling on the back of digital economy
transformation trends.
We identified the potential of edtech seven years ago (before
the sector started gaining widespread popularity), investing in
consumer-facing platforms like Udemy and Brainly that mirrored
marketplace and social businesses we knew well. This enabled
us to learn more about different business models and edtech
platform economics to capitalise on the sector once companies
started to scale.
Over the years, we have increased our conviction in the sector,
acquiring Stack Overflow, and investing in Skillsoft,
GoodHabitz, GoStudent, Eruditus and others (with a focus on
workplace and higher education).
The opportunity
The education opportunity remains massive post pandemic,
due to increasing demand for continuous learning and higher
levels of education that traditional systems will not be able to
fulfil as the global population grows. Between 2020 and 2050,
there are expected to be 1.6 billion5 new learners due to
population growth, increased education levels worldwide and
the need for ever-faster upskilling.
Traditional brick-and-mortar education systems face several
challenges, including spiralling costs, geographic constraints
that hamper access to education, uneven quality of education
staff and content, and rigid systems that cannot be
personalised and customised.
These issues are especially pronounced in developing countries.
Across Asia and Africa6, an additional 1.4 billion learners are
projected by 2050. Economics and demographics alone mean
the physical institutions and education products from the West
cannot reasonably be scaled to serve global needs.
1 In presenting and discussing our performance, we use certain alternative performance measures not defined by IFRS, referred to as non-IFRS-EU financial measures,
alternative performance measures or APMs. Such measures include economic-interest-basis information; trading profit; adjusted EBITDA; headline earnings; core
headline earnings; and growth in local currency, excluding acquisitions and disposals. Segmental reviews in this report are prepared showing revenue on an
economic-interest basis (which includes consolidated subsidiaries and a proportionate share of associated companies and joint ventures), unless otherwise stated.
Numbers included in brackets represent the equivalent measure on the basis of growth in local currency, excluding acquisitions and disposals. For further explanation of
the use of APMs, refer to about this report in the governance section.
2 Presented on an economic-interest basis.
3 Associates: Naspers or Prosus holds 10% to 50% with a board seat, meaning it has significant influence.
4 Excluding BYJU’S and Udemy for which we stopped equity accounting in September 2022.
5 Source: Global Projection, Medium SSP2 – IIASA.
6 Source: Wittgenstein Centre for Demography and Global Human Capital (2018).
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Integrated annual report 2023
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Revenue2
US$545m
(2022: US$425m)
Trading loss2
US$258m
(2022: US$117m)
At the same time, the skills gap is growing, with the greatest
talent shortage in technology. As digital disrupts traditional
industries, the impetus for reskilling has never been higher. On
the positive side, digital career paths open opportunities, and
online learning is a truly effective way to level playing fields.
In response to these demands, the sector has to change.
Technology has the potential to address these issues by
democratising, digitising, curating and personalising
education. We are still in the early days of an offline-to-online
shift. Global online penetration for education was only around
3% in 2019, but had doubled to 6% by 20227.
The broader education sector is projected to be a US$7.4tn
global opportunity by 2025. Within that, the global edtech
market is forecast to grow at 16% per year to some US$404bn
by 2025. We have identified much room for further growth as
the sector is transformed by technology.
Taking another big step forward
In FY22, Naspers invested more in edtech than in all previous
years combined. To date, we have invested over US$3.8bn
in 12 businesses to become one of the leading edtech
investors globally.
In FY23, we continued to focus on workplace/higher education
models as the different sectors have developed, and as we
identified key competitive advantages in their economic models.
Companies can play a massive role in creating a global culture
of upskilling to address the talent shortage and demand for
increased skills. This sector is therefore attractive for several
reasons, including strong demand as companies reskill/upskill,
high margins and predictability due to multiyear contracts.
7 Source: HolonIQ.
» Across workplace edtech, an evolution is also underway.
From the early days of transactional once-off purchases,
new learning platforms are forcing a tipping point of
recurring learning and subscription-based monetisation
as companies understand the importance of continuous/
lifelong development to improve performance and meet
employees’ expectations.
We have built a significant presence in enterprise
education, focused on the future of workplace learning. We
reach more than 90% of Fortune 100 companies across our
workplace-learning companies, including Stack Overflow,
Skillsoft, GoodHabitz, Udemy, Platzi and eduMe. People
look for lifelong learning and their job satisfaction depends
on the skills, experiences and knowledge they gain. So,
workplace learning is growing in importance and value, with
revenue opportunities to match.
» Our second priority is K–12 (kindergarten to grade 12)
education. With the increasing accessibility and affordability
of technology, edtech is playing a larger role – inside and
outside the classroom. Edtech tools, such as learning
management systems and educational software, are
providing personalised and interactive learning experiences
for students, leading to increased engagement and
improved academic outcomes. Additionally, edtech is
helping to bridge the digital divide by giving students
access to resources and learning opportunities that may
not otherwise have been available. Another trend evident
across our K–12 portfolio is integration of the online and
offline environments to improve students’ learning
experiences.
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Integrated annual report 2023
59
Edtech continued
We have built a strong presence in K–12, with Brainly now
reaching around 250 million users a month, GoStudent
serving customers in 23 countries, and BYJU’S quickly
expanding its offerings. Our aim is clear – we want to be
part of the foundational edtech of future generations.
» While generative AI (GenAI) platforms may present
competitive risk for some edtech companies, we believe the
technology is a massive opportunity for transforming
education and could be a real step-change for the sector.
There are several opportunities for edtech platforms to
leverage GenAI technology, including: highly personalised
learning: customised content based on individual needs by
analysing data and learning patterns to generate lessons,
tests and materials that adapt to each learner’s level, style
and pace.
» Content creation: Automated generation of multimedia
materials, including video, written or voice lessons,
infographics, testing materials and more.
» Assessment and feedback: Automated evaluation of a
learner’s work and the ability to provide instant feedback,
expediting the learning process.
» Virtual mentors: Simulated virtual mentors that interact with
learners, answering questions, providing explanations, and
guiding learners through materials, creating a more
personalised and immersive learning experience.
Many of our edtech companies, some in partnership with the
Naspers AI team, have already launched or are soon
deploying GenAI technologies on their platforms to enhance
the learning experience for their users. For Stack Overflow
specifically, we believe GenAI will be an important evolution
in how developers will work and learn in the future, enabling
them to be more efficient and better able to maintain their
flow state. The developer community can play a crucial role in
how AI accelerates, ultimately helping with the quality emerging
from GenAI offerings. Stack Overflow’s role is harnessing the
power of the developer community to the technological power
of AI, all to generate highly trusted solutions to technology
problems. Stack Overflow has devoted around 10% of the
company’s workforce to catalyse around the development of
its AI initiatives. It plans to officially announce its data
monetisation plans and specific GenAI initiatives in the coming
months.
In terms of cyber-resilience, our controlled assets are
strengthening their capabilities by implementing new technology
(such as a ransomware-resilience solution) and adding talent
to their IT teams. The Naspers group support team assisted
portfolio companies with IT risk assessments, ethical hacking
projects, and business continuity initiatives.
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Integrated annual report 2023
Focusing on workplace learning
100 million monthly visits
across the world
>14 000
enterprise customers
Around 680 million
page views monthly
Around 86 million learners
across the world
>14 000
enterprise customers
>62 million learners
across the world
>2 650
enterprise customers
800 programmes in partnership with
79 universities
Stack Overflow
Naspers, through Prosus acquired Stack Overflow in FY22 for
US$1.7bn. Since then, it has grown total bookings by 37% and
annual recurring revenue nearly threefold.
Stack Overflow, one of the top 200 websites in the world, has
built a global, highly engaged developer and technologist
community over the past 14 years and now registers around
680 million page views monthly.
Since acquisition, the business has contributed revenue and
trading losses of US$94m and US$84m respectively, driven by
growth in Stack Overflow for Teams, which enables
organisations to build their own communities on top of the
open platform. By March 2023, Stack Overflow for Teams had
over 950 paying teams, generating annual recurring revenue
of US$55m, and representing growth of 29% YoY.
Trading losses for the year increased, reflecting higher
investment in engineering and product development initiatives,
sales headcount and marketing programme expenses, and
general and administrative costs associated with growing
the business.
As at 31 March 2023, an impairment of US$560m was
recognised on Stack Overflow. The prior-year impairment
related to Stack Overflow as a result of increased discount
rates in the value in use calculation for this investment.
GoodHabitz
In FY22, we invested US$258m for a 62% interest in
GoodHabitz, a fast-growing European provider of online
training for corporates and small and medium-sized
enterprises.
GoodHabitz offers over 1 750 courses in over 13 languages to
more than 2 650 enterprise customers. It continues to expand
beyond its home market of the Netherlands, and is now
operational in 13 European countries.
For the year, GoodHabitz contributed revenue of US$40m and
a trading loss of US$16m to segment results, reflecting its
investment to scale. GoodHabitz is focused on strengthening
its European position via existing and new countries. In
addition, there are investments in new countries outside
Europe, focusing on Latin America, India and Australia. The
business is now concentrating on revenue growth and
operational scalability to become profitable.
training. It also hosts a vibrant community where learners
network with peers who help them secure their next job or
build a business with their new skills. Platzi has a content
library of over 1 500 courses ranging from coding, web design
and marketing to English. We invested US$50m in Platzi in late
2021 and our current stake is 19%.
Skillsoft
In FY22, we invested US$500m for 38% of Skillsoft, a global
leader in digital workplace learning that listed on the New York
Stock Exchange in mid-2021 (SKIL.N). In April 2022, Skillsoft
acquired Codecademy, already an investment in our Edtech
portfolio, to accelerate growth for both companies and
strengthen technology and product development to drive
incremental topline growth and value creation.
For the year to 31 January 2023, Skillsoft declined bookings
6% and revenue by 4%. Its larger core content segment grew
pro forma bookings by 5% and pro forma revenue by 5%. Its
client base is centred on large, blue-chip enterprises,
representing over 70% of Fortune 1000 companies and its
services are used by almost 45 million learners globally
across more than 160 countries.
As at 31 March 2023, Skillsoft was impaired to its market value
due to the significant decline in share price over time.
More information on Skillsoft is available at
https://investor.skillsoft.com.
Udemy
We first invested in Udemy in 2016. It listed on the Nasdaq
Stock Market (UDMY) in October 2021.
Udemy is a global education marketplace for lifelong learners
that gives over 59 million learners access to more than
200 000 courses in 75 languages. The platform offers courses
that can be accessed through the direct-to-consumer or
Udemy Business offering, which had over 14 000 enterprise
customers at 31 December 2022.
For its year ended 31 December 2022, Udemy reported strong
revenue growth of 22% to US$629m with consumer revenue
totalling US$315m, down 4%, and Udemy Business revenue
reaching US$314m, up 68% on the prior year. Udemy Business
contributed 50% to total revenue in the past 12 months compared
with 36% a year ago. Following the loss of significant influence,
the group stopped equity accounting for Udemy from
September 2022.
More information on Udemy is available at
https://investors.udemy.com.
Eruditus
Eruditus provides executive education and short, private, online
courses globally, partnering with the world’s leading
universities. The company makes high-quality education more
accessible by offering over 800 programmes in partnership
with 79 universities to a global audience covering the US, Latin
America, Asia, the MENA region and Europe. We have
invested US$187m in Eruditus since October 2020, with
a current stake of 13%.
Platzi
Platzi is a coding platform for training (in Spanish and
Portuguese) in tech skills, interpersonal skills and language
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eduMe
eduMe is a mobile-based training platform for the deskless
workforce, used by companies in over 60 countries worldwide
to give their workforces seamless access to relevant knowledge.
We invested US$12m in eduMe and our current stake is 13%.
SoloLearn
SoloLearn is an online learning platform for coding where
over 60 million coders learn, create and share programming
content with their peers. We have invested US$8m since 2018,
with a current stake of 18%.
Focusing on K–12
Brainly
Brainly is one of the world’s leading social-learning platforms,
serving around 350 million students, parents and teachers
across the world. Students use Brainly to strengthen their skills
in core subjects such as maths, history, science and social
studies. The platform allows them to connect with their peers,
subject-matter experts and professional educators to discuss
subjects and seek answers to tricky questions. We first
invested in Brainly in April 2016 and, to date, we have
invested US$77m with a current stake of 42%.
GoStudent
GoStudent is an online tutoring provider. Founded in 2016,
GoStudent serves customers in more than 20 countries,
providing paid, one-on-one, video-based tutoring to primary,
secondary and college-aged students in over 30 subjects.
In March 2022, we invested US$226m in GoStudent for an
8% stake.
BYJU’S
BYJU’S is a leader in personalised learning programmes for
students in India and beyond, targeting students from kindergarten
to grade 12 as well as those taking competitive exams.
We have invested US$536m in BYJU’S since 2018 and hold
less than a 10% stake. The group lost significant influence in
BYJU’S and stopped equity accounting for BYJU’S from
September 2022.
Looking forward
We will continue to play an active role in helping our
portfolio businesses grow and innovate so that more
people around the world can enjoy the benefits of
tech-enabled learning. We will also look for additional
opportunities to expand and strengthen our Edtech
segment.
In Edtech, as in all our core segments, we are interested
in real improvement for people’s everyday lives, long-term
impact, and sustainable value creation – fundamentally
changing the world of learning for the better.
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Integrated annual report 2023
61
Etail – eMAG1
Operational performance
Key statistics
Free cash flow
-US$170m
(FY22: -US$184m)
Capital expenditure
-US$142m
(FY22: -US$147m)
Number of employees
7 698
Stakeholder material matters
Employees: Job opportunities. Skills development.
Company culture
Regulators: Compliance across all regulatory
areas (fiscal, financial, environment and
competition)
Merchants: Growth and cross-border initiatives
Consumers: User experience. Range of products.
Quality, efficiency and reliable service at the right
price
Strategic focus
» Growth by focusing on categories that align with
3p market potential
» Improvements in time in stock, selling tools,
pricing and selection gap
» Accelerating core etail services: Genius and
Wallet
» Focus on profitability through improved margins
Risks
» Macroeconomic downturn and higher interest
rates
» Competition from specialists in verticals
» Geopolitical and economic uncertainty sparked
by the Russia–Ukraine conflict
Value drivers
» Enhanced value, convenience and pricing with
Genius loyalty programme for frequent users
» Affordability through HeyBlu wallet
» Wider selection from growth in marketplace
offering
» Convenience/delivery experience through
showrooms and locker network
Building a leading ecommerce ecosystem for
customers across Central and Eastern Europe
eMAG Group is our leading ecommerce platform in Central
and Eastern Europe. Over the years, it has built an ecosystem
of complementary businesses on top of its vibrant eMAG
Romania platform. From this 1p/3p (first-party/third-party)
business-to-consumer or B2C core, eMAG extended into other
categories:
» Fashion through Fashion Days.
» Food delivery through Tazz.
» Grocery delivery through Freshful.
» Logistics infrastructure across the group through Sameday.
» eMAG’s Genius loyalty programme that unites the customer
experiences of these businesses.
The Etail business recorded explosive growth in the pandemic’s
early stages as consumers stayed at home with limited offline
options. Post the pandemic in 2022, growth slowed due to
geopolitical and economic uncertainty sparked by Russia’s
invasion of Ukraine, and a post-pandemic partial return of
consumers to their offline shopping habits. At a macro level,
rising inflation, increasing energy prices, higher interest rates
and recessionary fears weighed on consumer confidence. For
etail businesses, these headwinds were compounded by
aggressive competition from offline competitors, as well as
over and understocking positions on the back of supply-chain
disruptions. As a result, GMV is -13% YoY (computed on
US$ translated amounts, and flat when computed in local
currency) and revenue is down by -14% (-4% in local currency)
to US$2.0bn. eMAG’s core etail business delivered a trading
loss of US$15m for the period (FY22: profit of US$13m).
eMAG continues to react to changed market conditions – scaling
back investments, focusing on profitability and maintaining a
compelling value proposition for its customers. The company
has reduced capacity to meet lower growth expectations and
slowed investment in new adjacencies. A key element of
eMAG’s response to changes in the market was its shift in
focus from 1p to 3p.
eMAG further adapted to the new context by becoming an
affordable alternative to offline stores through its wide range
of products, promotions/discounts, free delivery and flexible
payments.
Over recent years, eMAG has made strategic investments in
productivity and efficiency in the core business: Genius, the
loyalty programme, continues to build a strong base of
customers, and marketplace has recorded excellent growth
due to broader product selection and increasing availability
1 In presenting and discussing our performance, we use certain alternative performance measures not defined by IFRS, referred to as non-IFRS-EU financial measures,
alternative performance measures or APMs. Such measures include economic-interest-basis information; trading profit; adjusted EBITDA; headline earnings; core
headline earnings; and growth in local currency, excluding acquisitions and disposals. Segmental reviews in this report are prepared showing revenue on an
economic-interest basis (which includes consolidated subsidiaries and a proportionate share of associated companies and joint ventures), unless otherwise stated.
Numbers included in brackets represent the equivalent measure on the basis of growth in local currency, excluding acquisitions and disposals. For further explanation of
the use of APMs, refer to about this report in the governance section.
2 Presented on an economic-interest basis.
62
NASPERS
Integrated annual report 2023
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Revenue2
US$2.0bn
(2022: US$2.3bn)
Trading loss2
US$63m
(2022: US$35m)
of the easybox delivery feature. Genius subscriptions reached
517 000 (up 54%) and now accounts for nearly one third of
eMAG’s sales in Romania (ie 35% of eMAG Romania’s GMV,
and 37% of group GMV). eMAG Group’s easybox locker
network has expanded to 3 805 lockers in Romania, 685 in
Hungary and 241 in Bulgaria, increasing customers’ options
for pickup and reducing delivery costs.
Tazz, eMAG’s food-delivery service, continues to scale and is
now among the top participants in the highly competitive
Romanian market. Freshful, which was launched in 2021,
serves the underpenetrated and high-growth online grocery
sector and is a natural extension of eMAG’s core etail
business. By leveraging eMAG’s brand, purchasing scale and
delivery capabilities, Freshful is well positioned to become
a leading company in the grocery-delivery segment. In 2022,
eMAG and PayU launched HeyBlu, which offers financial
services to eMAG customers and allows a customer to defer
payment for a purchase by 30 days or to pay in four
instalments.
The opportunity
Total retail spending (offline and online) for Romania, Hungary
and Bulgaria is projected to grow at a CAGR of 6% from 2022
to 2026. Online penetration remains relatively low in these
countries, ranging from 8% in Bulgaria to 11% in Romania in
2022. As a result, ecommerce growth is expected to outpace
3 Source: Euromonitor, E-commerce (goods) as % retailing, YoY exchange rates.
retail’s total 6% growth rate and average 12% for Romania,
15% for Hungary and 17% for Bulgaria from 2022 to 2026 (as
per April 2023 Euromonitor report). These favourable macro
trends will provide momentum for eMAG’s businesses over the
long term3.
eMAG offering
1
eMAG Genius
Loyalty programme
2
eMAG easybox
Automated lockers
3
Sameday
Inhouse courier service
4
Fulfilment by eMAG
Fulfilment for 3p merchants
5
Tazz by eMAG
Food and
multivertical delivery
6
Fintech solutions
Consumer
credit solutions
7
Advertising solutions
Sponsored
merchant listings
8
Freshful by eMAG
Large-basket
grocery delivery
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63
Etail – eMAG continued
eMAG is focused on maintaining its status as a Central and
Eastern European preferred one-stop ecommerce platform. In
addition to its established ecosystem, it operates PC Garage
(specialised online retailer focused on gamers); Depanero
(repairs appliances and electronic devices); Conversion
Marketing (performance marketing); and Flip (refurbishes
and sells second-hand mobile phones).
Giving customers the best etail experience
To fulfil its mission of giving customers the best etail
experience, eMAG focuses on four key pillars: enhancing
convenience; helping customers make the right decisions;
delivering on its promise; and making the difference in society
while engaging customers on this journey.
Integral to reaching its goals is increasing customer
engagement. The largest business, eMAG Romania, increased
orders 4% YoY. While purchases of higher-priced items were
lower in the face of economic uncertainty, engagement on the
platform continued to increase. This is a key positive long-term
trend for eMAG, given its commitment to play an ever-bigger
role in meeting people’s everyday needs across Central and
Eastern Europe.
Key strategic initiatives supporting this commitment are
summarised below:
Growing Genius
The Genius premium subscription service has proved its
appeal with customers, growing to 517 000 subscriptions from
197 000 at September 2021. Genius subscribers double their
business with eMAG after joining and buying more broadly.
This aligns well with eMAG’s long-term ambitions. After
launching as ‘a subscription for free delivery’, Genius has
evolved into ‘an end-to-end effortless shopping experience’.
Genius members enjoy free home delivery for orders above
RON100, free delivery via lockers for orders above RON30,
free returns and exclusive Genius deals on eMAG, Fashion
Days, Tazz and Freshful.
Growing Sameday
eMAG Group continued to strengthen its Sameday courier
business, which aims for a 99% on-time delivery rate. In FY23,
Sameday grew revenue 19%, meeting increased demand for
deliveries from eMAG and other businesses in Romania and
Hungary. Sameday has grown rapidly to consolidate its
important presence in Romania, strengthened its operations in
Hungary and launched in Bulgaria.
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Integrated annual report 2023
Expanding the easybox network
Added value from grocery delivery
The popularity of Sameday’s automated easybox lockers
continues to grow – 81% of Genius orders are delivered
via easybox, for example. These lockers give customers
24/7 service, pickup flexibility and over 99% on-time delivery
rates. They are also cost-effective to operate and more
environmentally friendly as they reduce the need to deliver
to multiple individual addresses.
Sameday continued to expand the easybox network in
Romania, from 2 500 to 3 805 lockers by the end of FY23, with
over 60% of eMAG orders in Romania delivered via easybox.
The easybox network in Hungary grew to 685 lockers and the
first 241 lockers were installed in Bulgaria.
The easybox service has also been enhanced for added
customer convenience. For example, customers can return
items when it suits them via the lockers, with an instant
electronic refund once they close the door. Called ‘magic
return’, this method is quicker, safer and greener – and a
good example of improving everyday life.
In addition, 37 lockers now have their own solar panels –
making the service even more environmentally friendly. The
plan is to roll out more solar-powered lockers.
Fulfilling orders for third-party partners
The company continues to invest in and grow its Fulfilment
by eMAG programme, where it manages delivery logistics for
3p partners. This enables eMAG to ensure delivery quality
for customers and deepen relationships with merchants.
Added convenience from food delivery
eMAG’s Tazz food-delivery service has quickly become one
of the top participants in the highly competitive Romanian
market, growing orders 15% from a year ago. Capitalising on
significant investments to build the brand and customer base,
Tazz is now focused on expanding to new cities and
integrating into eMAG’s Genius programme. GMV generated
from Genius represents 43% of Tazz’s total GMV and Genius
customers are becoming more relevant, with higher frequency
of orders and larger baskets. eMAG plans to extend this
service further in FY24.
Freshful, operating for over a year, enjoyed rapid adoption
due to a generous line-up of items, including small local
producers and distinctive delivery service. It now offers
a comprehensive range of 16 700 items, focused on local
produce for truly fresh food. Setting it apart in the market,
Freshful has a dedicated warehouse and refrigerated delivery
fleet to ensure customers get exactly what they want, quickly
and conveniently.
From 33 000 orders per month by end-FY22, Freshful grew to
75 600 monthly orders delivered in March FY23. High
customer satisfaction reflects the range and quality of
groceries on offer, coupled with the reliable ordering and
delivery service. Available initially in Bucharest, and now in
one more city, eMAG plans to expand Freshful city by city,
leveraging the eMAG brand, purchasing scale and delivery
capabilities.
Expanding to financial services
eMAG’s partnership with PayU via HeyBlu offers customers
convenient and flexible financial services, available for all
categories of eMAG products or those from sellers active
on eMAG marketplace. Options include:
» Buy-now/pay-later (BNPL), where the shopper postpones
payment for 30 days without any costs.
» Payment in equal monthly instalments, with the first paid at
transaction date and the balance over ensuing calendar
months.
These services are being piloted in Romania and reflect
eMAG’s commitment to developing ecommerce infrastructure
services to offer customers a high-quality, reliable experience
across the ecosystem – one that truly delivers value and
improves their everyday lives.
Promoting a circular economy
eMAG’s mission to bring complementary businesses into
the ecosystem and promote a circular-economy model is
illustrated by its investments. Flip, the Romanian start-up that
refurbishes and resells second-hand mobile phones, also
prevents significant quantities of electronic devices from
ending up in landfills. In FY23, Flip expanded into Bulgaria
and Hungary, and increased sales significantly to US$39.5m
GMV (full P&L, of which US$20m relates to eMAG Group).
Additionally, eMAG encourages its customers to select
returned and resealed ‘second-chance’ products, it offers a
buyback programme for used home appliances in exchange
for a voucher towards buying a new appliance (and eMAG
collects the old appliance for free), and Depanero offers
repair services for appliances and electronic devices.
In FY23, Depanero repaired 317 000 products across
Romania, Bulgaria and Hungary; and sales of resealed
products on eMAG’s platform increased by 48%. These
examples illustrate how eMAG acts for the benefit of
customers and the environment by extending the life cycle
of products offered on its platforms.
Looking forward
eMAG will continue to grow by extending the Genius
loyalty programme, expanding financial services, rolling
out more easybox lockers, repairing more products,
increasing the delivery of food and groceries, and doing
more to support the circular economy. Building on its
mission to give customers across Central and Eastern
Europe the best retail experience, the group is set to
broaden and deepen this experience and provide it in
ever-more sustainable ways.
Maintained scale, representing revenue of
US$1.95bn
517 000 Genius subscribers
>4 700 lockers throughout
Romania, Bulgaria and Hungary
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Integrated annual report 2023
65
Etail – Takealot group
Operational performance
The Takealot group grew GMV 13% (FY22: 34%) and revenue
12% (FY22: 27%), both on a local-currency basis, excluding
M&A, despite tough market conditions. Trading losses,
however, increased to US$22m.
Takealot.com successfully navigated the challenges of global
supply-chain constraints across multiple categories, especially
consumer electronics. It delivered revenue growth of 11% (in
local currency) for the year.
Despite increased competitive pressure from offline retailers,
Superbalist delivered strong revenue growth of 11% (in local
currency), but aggressive pricing from brick-and-mortar
retailers and discounts to clear ageing stock squeezed
margins and resulted in higher trading losses.
In FY23, Mr D faced softening demand for delivered meals
as consumers were impacted by high food price inflation and
a return to pre-Covid-19 behaviour patterns for in-person
dining at restaurants. In addition, the supply of delivered
meals contracted as electricity loadshedding restricted
restaurant hours of operation. Competition intensified as well,
with more restaurants starting to make their own deliveries.
Despite this, the business grew orders and grew GMV by 8%
(11% including groceries).
The return to pre-Covid-19 shopping behaviours and a
challenging macro environment put some strain on the financial
performance of the Takealot group in FY23. Rising inflation,
increasing energy cost, lower consumer confidence and
increased operational costs from staged loadshedding across
South Africa created an unfavourable business context. On the
positive side, all businesses continue to deliver growth versus
the previous financial year, and the Takealot group increased its
share of transactions among retailers in South Africa.
To deal with the prevailing challenges, the Takealot group
scaled back investments and hiring to focus on maintaining
its customer value proposition while optimising the capital
and operating expense base. New customer value
propositions were implemented, including the rollout
of same and next-day delivery, as well as new offerings,
such as the grocery-delivery service. The company expects
further growth of its marketplace segment, offering sellers
a compelling platform while extending and deepening the
product selection for customers. Takealot also supports new
sellers through its onboarding process, coaching them on how
to grow their business.
The opportunity
The South African economy continues to recover from the
effects of the pandemic, albeit more slowly than expected,
with GDP growth forecast by National Treasury at 0.9%
in 2023. Employment growth picked up in the second half
of the 2022 calendar year, but the labour market remains
challenging. In parallel, the trading environment faced rising
Key statistics
Free cash flow
-US$51m
(FY22: -US$64m)
Capital expenditure
-US$31m
(FY22: -US$24m)
Number of employees
2 668
Stakeholder material matters
Employees: Job opportunities and skills development,
increased diversity across workforce
Regulators: Changing regulatory environment. Building
relationships and transparency with regulatory bodies
within trading environment
Merchants: Adoption of merchants onto the platform
Consumers: Providing value, affordability, selection and
convenience
Strategic focus
» Increasing profitability while continuing GMV growth
» Advanced supply chain and logistics capabilities
» Sustainable retail provider
Risks
» Macroeconomic downturn and high interest rates
leading to decreased consumer disposable income
» High inflation, particularly fuel and energy costs, as
well as nationwide staged electricity loadshedding
increasing the cost of doing business
» Online penetration of ecommerce compared to total
retail market
Value drivers
» Expanding of delivery options
» Entry to new verticals, such as grocery delivery
» Dedicated coaching and support for marketplace
sellers
Saving customers time and money, enabling
businesses and creating opportunities across
South Africa
The Takealot group is a leading ecommerce company in
South Africa, with three major businesses:
» Takealot.com: A general online retail and marketplace platform.
» Superbalist: Leading online apparel and footwear retailer,
focused primarily on young consumers (18 to 30 years)
» Mr D: A first-party (1p) food-delivery marketplace. In FY23,
Mr D entered the online grocery market in collaboration with
Pick n Pay, one of the country’s biggest offline grocery chains.
1 Presented on an economic-interest basis.
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Integrated annual report 2023
Revenue1
US$808m
(2022: US$827m)
Trading loss1
US$22m
(2022: US$7m)
fuel costs, higher levels of inflation, staged loadshedding,
supply-chain disruptions and rising interest rates. Higher prices
have produced a cost-of-living squeeze for customers with
lower customer confidence.
The pandemic accelerated the longer-term momentum behind
ecommerce in South Africa and there is still room for further
growth. Despite a reversion in consumer behaviour towards
malls and stores from 2022, and poor overall consumer
demand, the underlying shift from offline to online retail is
expected to continue. The total ecommerce market in South
Africa is projected to grow from R49bn in 2023 to some R73bn
in 2025, which will represent a 4.8% penetration of total retail.
This is well below many other countries – from China to Brazil
– and highlights the vast potential for South Africa and the
Takealot group.
Contributing to the country
Over the past 12 years, Takealot has become part of
the everyday lives of many people across South Africa as
the preferred source for quick, easy, reliable ways to buy
items, order food, and more. Takealot stands out for having
made these services as widely available as possible –
notably by offering them in informal settlements from the start.
Equitable access and availability have always been a core
Takealot principle.
Importantly, Takealot has contributed to job creation and
economic prosperity. Over 70% of employees are under the
age of 35. This makes Takealot a significant contributor to
creating job opportunities for young people in South Africa,
where the youth unemployment rate is currently over 45%.
In addition, Takealot.com has focused on encouraging
as many sellers as possible onto its platform and helped
them make the most of the platform. In FY23, there were
9 866 active sellers, up from 310 nine years ago. Many of
these are small to medium local businesses, which in turn are
creating more jobs and generating more economic activity.
If we consider the multiplier effect of these jobs created – for
example, if every seller on average has three or four people
working for them – the resultant job creation is significant.
Another example is the growth in drivers over the years, from
around 400 in 2011 to close to 16 000 in FY23. The pool of
franchisees has grown too.
Through Takealot’s ecosystem, more people and more
businesses benefit; as Takealot grows, so does the positive
impact on South Africa’s economy and society.
Looking forward
Takealot is investigating opportunities and new ways to
expand the platform and services and increase
investment in its logistics and supply-chain infrastructure,
so everyone involved can gain.
The group has embarked on a major programme to
upgrade much of its platform, to ensure the business can
easily handle continued growth and expanding services.
The objective is to produce a business that is more
resilient and more flexible – one that can scale quickly
and effectively, and in new ways, to meet the needs of
customers and partners.
The group will also continue to look for more ways
to support all the participants in its ecosystem. This
includes exploring ways to help more new businesses
participate and succeed. The aim, as ever, is to enable
as many people and businesses as possible across South
Africa to benefit from Takealot.
NASPERS
Integrated annual report 2023
67
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Other ecommerce: Ventures1
Operational performance
Ventures
Covers
>80 000 villages across
26 states in India
>400 brands on the platform
receive access to +250 000
kirana shops
60 markets across Mexico,
Colombia, Chile and Peru
Handles >15 million packages per
year
>35 000 SMEs
>1 000 enterprise clients
>320 000m2 warehouse
space across 35 cities
Delivers to
>100 cities
>200t fruit processed daily
>25 000 farmers in supplier network
>250 production pockets across the
country
Serves
>1.8 million farmers providing
access to >4 000 agricultural inputs
Vast network of 11 000 DeHaat
centres across
11 Indian states
Robust last-mile supply chain in
>110 000 villages across
>150 districts of India
Onboarded >2 000 agribusiness
institutions (input manufacturers, FMCG
companies, banks, output exporters
and insurance partners) on its platform
for direct access to farmers
India’s third-largest
online marketplace by GMV
3 million average
daily orders
>100 million
product listings
140 million
annual transactors
85% repeat users
275 million downloads
in 2022, making it the
most-downloaded shopping
app globally for two
consecutive years
>1.1 million sellers on the
platform in seven years
60% of 500 000 suppliers
onboarded in 2022 were new
to ecommerce
40 000 registered fisherfolk
Operates in 177 locations in
31 provinces in Indonesia
(90% of the country)
7 000 job opportunities in rural
areas of Indonesia
>10 000 connected
data sources
>800TB data processed
per month
>700 000 actionable
insights served to improve
safety and productivity
Deployments in 13 countries
Deployment support extended
to 25 geographical regions
Identifying and investing in the next wave of
group growth
Evolving market
Recent years have been transformational for Naspers Ventures
in many respects. While the world has become increasingly
volatile, we are confident about our operating structure. The
key is that, like the wider group, we invest in businesses that
are solving big societal needs with technology, in a uniquely
local way.
As a long-term investor, we expect fluctuations in the market.
We have experienced this before, as Naspers has invested
over decades across a number of high-growth sectors and
geographies. Equally, as both operator and investor, we have
weathered the impact of previous periods of economic
instability.
We believe there are still opportunities to invest in quality
companies and many will emerge from the downturn as
stronger, more sustainable businesses.
When evaluating new investments, the bar was indeed higher
this year given the level of uncertainty in the market. While this
may result in a lower quantum of dollars deployed, we
continue to prioritise our earlier-stage investing, and, as a
business, we are hyper-focused on our criteria across
industries and geographies.
Additionally, we have an even greater focus on our existing
portfolio and will prioritise investments in these companies,
helping our founders and their teams to weather
macroeconomic impacts. Several of our founders are facing
adverse market conditions for the first time, and we continue
to advise them based on what makes sense for their stage
of development.
Naspers is a truly global investor, operating in over 100
countries. This deep understanding of international markets
enables us to offer a global perspective on macroeconomic
conditions, backed by a level of local expertise, which
becomes an added layer of support for our founders and
companies.
Nurturing the next wave of growth
Naspers Ventures partners with innovative entrepreneurs
around the world to build leading technology companies in
high-growth markets. We act as the group’s incubator for new
investment areas. This will remain unchanged as we continue
to believe in our underlying thesis, zeroing in on sectors of the
economy where technology can lead to meaningful change in
consumer and business behaviour and economics.
1 In presenting and discussing our performance, we use certain alternative performance measures not defined by IFRS, referred to as non-IFRS-EU financial measures,
alternative performance measures or APMs. Such measures include economic-interest-basis information; trading profit; adjusted EBITDA; headline earnings; core
headline earnings; and growth in local currency, excluding acquisitions and disposals. Segmental reviews in this report are prepared showing revenue on an
economic-interest basis (which includes consolidated subsidiaries and a proportionate share of associated companies and joint ventures), unless otherwise stated.
Numbers included in brackets represent the equivalent measure on the basis of growth in local currency, excluding acquisitions and disposals. For further explanation of
the use of APMs, refer to about this report in the governance section.
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Integrated annual report 2023
In FY23, we invested and committed over US$200m in more
than 30 closed transactions. We will continue to invest in
market disruptors, the next generation of tech-enabled industry
titans, those being founded and funded now. In line with our
momentum over recent years, we will expand investments
across ecommerce, AI, fintech, mobility and logistics, agtech
and sustainability, B2B and blockchain, in addition to software
as a service (SaaS) and other frontier tech.
Our geographic focus will remain consistent with previous
years as we have grown our investments and leadership in
India, as well as our presence in south-east Asia, Europe and
the Americas.
We will continue to invest in the new year, as we expect more
opportunities ahead. Despite market conditions, it is an
exciting time for new frontier technology, and we look forward
to uncovering the next wave of entrepreneurs with high
potential and the ambition to scale.
What we look for
Ventures follows the group approach by investing in a
disciplined, focused way. We look for three key criteria:
» We back businesses with large total addressable markets
(TAMs) that meet big societal needs in high-growth regions,
and where we can really make an impact as an investor.
» We focus on sectors of the economy where technology can
lead to meaningful change in consumer behaviour and
economics.
» We invest in world-class entrepreneurs who want to build
leading technology companies.
Geographic focus
India
India remains a high-focus area, given the vast opportunity for
growth in the market across a number of sectors, and the
competitive edge we have built as an investor over the years.
India is one of the few countries where the demographic
dividend is still to play out. In the next decade, there will be
more people of earning age than those who need to be
supported. In addition, this large workforce is skilled in
technology and has global exposure. India has a large and
vibrant local economy that has emerged as the fastest-
growing major economy in the world, as well as the most
populous. With a large domestic market that is relatively
less-exposed to international trade flows, India’s economy is
well positioned to weather global spillovers compared to most
other emerging markets. Several of our companies have
joined the ranks of Indian unicorns.
New markets
In the past three years, we have invested in a number of new
markets where we have identified strong growth opportunities.
We have significantly expanded our presence in areas such
as south-east Asia, Europe and the Americas.
Sectoral focus
Mobility and logistics
The logistics industry is growing in tandem with growth in
ecommerce as rapidly changing consumer expectations and
trends during the pandemic become entrenched behaviours.
This includes a surge in last-mile and same-day deliveries.
AI
Start-ups using AI are making better data-driven decisions,
automating tasks and more to unlock new competitive
advantages. In line with our focus to invest in frontier tech, we
expect more innovation in this space, and it will remain to be
a growing focus area in future.
Agtech and sustainability
Agtech and sustainability are increasingly important areas.
As climate regulation remains top of the global agenda and
consumers become more climate conscious, we expect more
growth, innovation and adoption in this field. We have several
investments in the alternative proteins sector that prioritise
reduced environmental impact, as well as companies bringing
efficiency to farming, and crop production and the fisheries
sector.
Deep-tech
Deep-tech innovation is solving some of the world’s most
significant problems, while advancing humankind. These are
companies that focus on novel breakthroughs and deep
intellectual property or IP. Recently, we made our first
investment in this category. Oxford Ionics is a high-
performance quantum computing company delivering unique
innovations to create powerful, accurate and reliable quantum
computers to solve the world’s most critical problems.
Looking forward
We expect the 2023 calendar year to be a key period for
many of our portfolio companies and we will continue to
support our exceptional founders and companies while
remaining an active investor. As we are flexible investors
per our investment thesis and invest when we see an
opportunity, this enables us to invest in ideas and
companies that will be part of the next wave of growth
for Naspers and high-growth sectors all over the world.
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Integrated annual report 2023
69
Social and internet platforms1
Operational performance
Tencent
Tencent weathered a challenging 2022 with resilience,
supported by its diversified portfolio of products, businesses
and investments. For the year ended 31 December 2022,
revenue declined 1% to RMB555bn. Non-IFRS profit attributable
to shareholders (Tencent’s measure of normalised
performance) declined 7% to RMB116bn.
The opportunity
China recorded 3% annual GDP growth in 2022 amid Covid-19
lockdowns, global concerns about prolonged inflation and
increased geopolitical tensions. The Chinese government
relaxed pandemic restrictions at the end of 2022 and
reopened borders in January 2023. The World Bank forecasts
that China’s economy will grow by 4.3% in 2023, and 5% in
2024. China is the world’s largest consumer internet market
and continues to grow ahead of many other large internet
markets. There were 1.067 billion internet users in China in
December 2022 (1.032 billion in December 2021), 99.8% of
whom were mobile users. With a highly mobile-penetrated
population, growing middle class and increased investment
in the digital transformation of industries, the opportunity in
China’s internet industry remains vast.
Continuing to lead
Tencent is a global internet and technology company that
develops innovative products and services to enrich the lives
of users. Its communication and social services connect more
than one billion people worldwide, enabling them to stay in
touch with friends and family, shop online, pay for daily
necessities and be entertained.
Tencent publishes some of the world’s most popular games
and other high-quality digital content, enriching interactive
entertainment experiences for people around the globe.
It also offers a range of business services such as cloud,
enterprise services, fintech and advertising to support its
clients’ digital transformation and business growth.
Monthly active users of Weixin and WeChat reached 1.3 billion,
up 3.5% YoY. User time spent on Weixin continued to grow
as it expanded its content, service offerings and short-form
video capability. Time spent on Mini Programs and Video
Accounts doubled and tripled YoY respectively, in the fourth
quarter of 2022. Mini Programs has become a leading
transaction platform in China, contributing to the growth
of the real economy. Video Accounts has become a major
short-form video and live-streaming platform in China.
Tencent enlivened the video chat experience for QQ by
adding Super QQ Show avatars using enhanced motion-
capture technology to mirror users’ facial expressions and
gestures in real time. It enriched the content of anime, comics
and games for QQ’s short-video service, Mini World, and
launched AI-powered video-creation tools, significantly
increasing daily active users and time spent per user.
It continued to lead in the China online game market, with
Honour of Kings resuming YoY growth in daily active users in
the fourth quarter of 2022. Internationally, Tencent elevated
Valorant as a top global franchise and published two of the
top three new mobile games of the year.
In online media, Tencent Video’s subscriptions moderated
slightly to 119 million due to content-scheduling delays, while
subscription revenue increased YoY in the fourth quarter
of 2022 in line with average revenue per user growth.
In advertising, Tencent improved its long-term position by
launching Video Accounts in-feed ads, enhancing transaction-
driven capability and machine-learning infrastructure in 2022.
In the fourth quarter of 2022, advertising returned to YoY
revenue growth. Click-to-message and click-to-purchase ads
accounted for over one third of Weixin’s advertising revenue.
In fintech, Tencent’s commercial payment business was
temporarily impacted by Covid-19 outbreaks, which
significantly slowed volume growth. It is expanding its wealth
management and exploring opportunities in consumer loans
and online insurance services.
In business services, Tencent further reduced loss-making
activities and optimised costs while focusing on healthier-
margin, self-developed platform-as-a-service solutions such
as video cloud and database.
It made significant progress in its drive to create sustainable
social value and announced its commitment to carbon-
neutrality by 2030. Tencent’s digital philanthropy platform
raised donations for over 25 000 projects and engaged more
than 100 million users. In 2022, Tencent increased its return of
capital to shareholders through distribution in kind, share
repurchase and cash dividend.
1 In presenting and discussing our performance, we use certain alternative performance measures not defined by IFRS, referred to as non-IFRS-EU financial measures,
alternative performance measures or APMs. Such measures include economic-interest-basis information; trading profit; adjusted EBITDA; headline earnings; core
headline earnings; and growth in local currency, excluding acquisitions and disposals. Segmental reviews in this report are prepared showing revenue on an
economic-interest basis (which includes consolidated subsidiaries and a proportionate share of associated companies and joint ventures), unless otherwise stated.
Numbers included in brackets represent the equivalent measure on the basis of growth in local currency, excluding acquisitions and disposals. For further explanation of
the use of APMs, refer to about this report in the governance section.
2 Presented on an economic-interest basis.
70
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Integrated annual report 2023
Revenue2
US$22.3bn
(2022: US$25.3bn)
Trading profit2
US$5.1bn
(2022: US$6.3bn)
Looking forward
The regulatory environment of China’s internet industry
continues to evolve, reflecting its expanding economic
and social importance. In 2022, Tencent increased its
business efficiency, sharpened its focus on core activities,
and developed new services and revenue lines,
successfully repositioning the company for sustainable
and high-quality growth. It is investing in AI capabilities
and cloud infrastructure to embrace foundation models,
which it believes will enhance the experience of its
existing products and services, and allow it to explore the
introduction of new products.
Tencent is committed to enacting its vision of ‘value for
users, tech for good’ by continuing to develop advanced
technologies and innovative products and services that
create shared value and promote the sustainable
development of society. Tencent sees ample opportunities
in both the consumer and industrial internet as technology
advances.
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71
Media24
Operational performance
Delivering an outstanding performance across the business – from digital and print media
to ecommerce
Quick read
In recent years, Media24 has been building a
leaner, profitable, digital-first South African media
business with a significant investment in
ecommerce. In FY23, the streamlined but still
diverse business portfolio, combined with stringent
cost management, contributed greatly to its ability
to remain profitable despite a trading landscape
under severe pressure.
» Lagging and/or fluctuating print circulations, but sustained
strong digital subscriber growth at both News24 and
Netwerk24.
» Cost-saving initiatives at the print-publishing businesses
hampered by the sharp increase in paper prices and
record fuel prices.
» Improved income from reigniting diverse revenue projects
at Lifestyle.
» Continued growth in external media logistics revenue at
On the Dot.
» M24 Logistics countered declining ecommerce volumes – in
line with international trends – by curtailing costs.
» Media24 TV reaping the benefit of unbudgeted television
Leading in media
commissions.
» Excellent school textbook orders in South Africa.
» Sustained strong trade sales at Jonathan Ball Publishers.
» Costs tightly managed.
Media24 implemented several cost-saving initiatives in the
second half to offset contractions in the market, but without
compromising its value offering or areas of growth.
Maintaining media ethics and independence
Editorial independence and ethical reporting are cornerstones
of our business. This is reflected in our core values – respect,
integrity, courage, and accountability – which are embedded
in our employment contracts and policies. Our publications
subscribe to the South African Press Code, which prescribes
news that is fair, accurate, truthful and balanced, as well as
the code of the Advertising Standards Association, which
promotes responsible and truthful advertising devoid of false
claims. The internal ombudsman monitors ethical reporting in
our publications. Complaints on media ethics and
independence may also be referred to the South African Press
Council. Staff is required to complete training on our code of
ethics, as well as other related topics, including whistleblowing
and privacy.
Media24 is one of the leading print and digital media groups
in South Africa, with interests in digital media and services,
newspapers, magazines, ecommerce, book publishing and
media logistics. Through its magazines and newspapers, it
reaches 1.4 million average daily unique browsers, generating
10.9 million average daily page views across its digital
platforms.
Weathering the economic storm
Despite an already slow start to the financial year and an
economic downturn that intensified from the second quarter,
Media24’s trading results for the period outperformed
expectations, but were much lower YoY.
Over the past two years, favourable trade conditions
supported exceptional results from strong revenue growth,
boosted by the leaner cost base established in 2020.
However, as expected and forecast, the level and scope of
the recovery recorded in 2021 were not sustainable in the face
of harsher domestic and international economic realities in
a post-pandemic world, hampered by the fallout from
global events.
Despite these challenges, total consolidated revenue of
US$207m for FY23 was -16% (-1%) YoY. This, coupled with
stringent cost management, sustained trading profit to US$7m,
a -69% (-56%) decline against the prior year. This was achieved
on the back of mixed results, marked by the following
operational factors:
» A considerable pullback on digital advertising, in line with
global trends, with print advertising following suit from the
second quarter.
1 Presented on an economic-interest basis.
72
NASPERS
Integrated annual report 2023
Revenue1
US$217m
(2022: US$257m)
Trading profit1
US$7m
(2022: US$17m)
Looking forward
We maintain our strategy to build a smaller, profitable
media business with a significant interest in ecommerce,
while transforming and cementing business sustainability
for a digital-driven future.
Quality journalism and publishing
Media24 has a proud history as the home of quality
journalism and publishing. The long list of local and
international industry awards include: News24 named by the
Reuters Institute as most trusted news brand in the country for
the fourth year in a row; a second consecutive One World
Media Award (News24); three INMA Global Media Awards
and eight honourable mentions; six IAB Bookmark Awards,
including the Black Pixel Award as best online publisher for
the sixth consecutive year; four MOST Advertising Awards,
including Lifestyle named as Media Owner of the Year; New
Media received three awards and four honourable mentions
at the Eddie & Ozzie Awards (New York) and a gold award
from the International Content Marketing Institute; 22 winners
in top three positions in the Forum of Community Journalists
Excellence Awards; three Standard Bank Sikuvile Journalism
Awards and three commendations; two WAN-IFRA African
Digital Media Awards; eight regional winners in the Vodacom
Journalist of the Year Awards; and a slew of national literary
awards for authors at NB Publishing.
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Integrated annual report 2023
73
Returning value
to shareholders
74
NASPERS
Integrated annual report 2023
We are committed
to building a ‘cycle of
value creation’
Effective solution to unique
challenge, creating immense
value for shareholders
September 2022
Launched multiyear share
buyback funded by sale of
Prosus shares
Year-end
Repurchased
16.3 million
Naspers shares
with a total value of
>US$2.5bn
Increase in NAV per share for
shareholders
4.5%
Tencent dividends remain
a meaningful and stable
contributor to our cash flow
Reducing the discount
80
60
40
20
0
Prosus
Naspers
June 2022
March 2023
NAV per share accretion
compounds over time (%)
25
20
15
10
5
0
Year one
Year two
Year three
Assuming buyback continues based on annualised value
We have great confidence in Tencent’s
long-term prospects and the execution
of the buyback programme will result
in the group increasing net asset value
per share.
History of dividend to free-float
shareholders of Naspers
and Prosus (R)
10.00
8.00
6.00
4.00
2.00
0
4
1
0
2
5
1
0
2
6
1
0
2
7
1
0
2
8
1
0
2
9
1
0
2
0
2
0
2
1
2
0
2
2
2
0
2
Naspers
Prosus
NASPERS
Integrated annual report 2023
75
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Sustainability review
Our approach
Creating sustainable value
Mitigate harm
linked to
business and
operations
Do good
by investing in
communities
Lead
sustainable
transitions
We create sustainable value for key stakeholders through our business model and in line with the United
Nations Sustainable Development Goals (UN SDGs). Below is an overview of the nine SDGs that our
business, companies and people contribute to in a significant and material sense. Please see our website
for more details.
We are living in an increasingly turbulent and unpredictable
world where technology is rapidly transforming the way we
live and interact with each other. In this post-Covid-19 reality,
with geopolitical instability contributing to already-stressed
resources, on 15 November 2022, the eight-billionth human
being was born.
We have no choice but to transition to a more sustainable way
of being able to meet the needs of this generation and the
generations to come. And critically, every person in society
needs to be part of this transition. We believe we can harness
the power of technology to drive this transition, which is why
being a force for good underpins our sustainability purpose.
Our capital allocation strategy reflects this opportunity as we
continue to increase our exposure to revenues from a
well-diversified portfolio of asset-light and low-carbon digital
services. As one of the world’s largest technology investors,
creating sustainable value lies at the core of everything we
do. The companies we invest in are visionary entrepreneurs,
rooted in their local communities, building virtual businesses
with a lower carbon footprint than their old-economy offline
counterparts. Our portfolio of digital services is driving a
systemic transition, from a linear economy of take-make-waste
towards a circular economy and improving material efficiency
and use of sustainable resources.
Every investment we make has the potential to reduce
inequalities and drive innovation. By investing in local
entrepreneurs who are solving for local needs, we support
local economic growth in those communities – in the long run,
this is the most sustainable way of driving economic parity
and equitable access to opportunity in a society. Digital
financial services, for example, reach people previously
underserved by businesses using brick-and-mortar
infrastructure. Our portfolio of edtech platforms is enabling
businesses using an increasingly diverse user group to access
online learning anytime, anywhere without the carbon footprint
of a physical learning institution. Similarly, etail allows for
selling and buying products without the accompanying
physical footprint while our best-in-class food-delivery
businesses are creating livelihood opportunities in countries
where there is high youth unemployment.
Sustainable value creation
The criteria for our investment decisions are clearly defined
and exclude or limit our exposure to revenue from business
models that conflict with our sustainability-driven approach.
Our approach is characterised by the overarching objectives
to mitigate risk, manage performance, and create sustainable
value. It is founded on our three pillars of responsible
investing:
» We proactively aim to avoid exposure to revenues from a
defined set of controversial activities such as carbon-intense
business models, pornography, tobacco, weapons, and
others.
» Once an investment decision is made, we continue to apply
an ESG lens to track performance and gauge the progress
of companies in which we acquire a controlling interest.
While the nature and definition of material impacts may
vary between companies, we apply consistent ESG
principles and systemically cascade our sustainability
agenda to our subsidiaries. These include data privacy and
cybersecurity, human rights, business ethics and compliance,
and climate action.
» We will continue to increase our exposure to revenues from
sustainability-native business models. Our Ventures team
is exploring potential new segments from carbon reduction
to smart mobility. For example, we invested in companies
such as DeHaat, Aruna, Biome Makers and Vegrow that
apply sustainable digital solutions in agtech by using soil
biology analytics and AI-based tools to determine the most
sustainable solutions for crops and address specific climate
and societal challenges.
Responsible business
Our family of companies is well diversified by sector and
geography, which is our strength and differentiator. While
the experience of doing business in difficult contexts is our
competitive advantage, it also presents challenges. Our assets
span an array of political and social contexts, along with vast
variances in maturity of these companies in addressing ESG
topics. Most of the companies are privately held, building
technology-based commercial strategies in tough markets.
However, we believe that by securing leading positions in
fast-growing markets, our businesses can create the
opportunities and connectivity that are preconditions for
societal development and environmental protection.
While the principles we bring to our portfolio companies are
consistent as set out in our sustainability policy and
environmental programme, we apply a differentiated
approach to engaging with them defined by our level of
interest in the company, in turn an indicator of our ability to
influence. In our corporate operations, we control
our sustainability strategy. Where we have controlling interests,
we work closely with the companies to ensure management
embeds our principles for all material issues, adapted for
factors such as business model, operations, employees and
geography, resources, and the complexity of their activities.
Where we have significant minority investments, we leverage
our board seat, where we have one, to share our sustainability
agenda and ESG principles. The demographics of the
companies where we hold minority investments are vastly
different, ranging from very mature listed entities to companies
in their early growth stages. The resource allocation for
engagement and monitoring of their ESG performance will
remain nuanced, based on the type of company and their
materiality on our balance sheet. Across all these companies,
however, if we have a non-controlling interest, we remain
relatively limited in our ability to influence the companies’
strategy and activities.
Our engagement considers the position and role of the private
sector in the larger country-level operating context of each
group company. This includes requirements of local
regulations, making a one-size-fits-all approach highly
impractical. In the rare situation that national law conflicts with
international standards, we expect compliance with national
law and seek ways to respect the principles of internationally
recognised standards and best practice.
Our sustainability accelerators network (SAN) is an
engagement opportunity that we offer to all Naspers
companies, regardless of control and ownership levels. This is
a forum where sustainability leaders and experts across the
group come together each quarter to share updates and
exchange best practices. This network has led to further
thematic offshoots like the packaging and waste working
group that catalysed reports to support the companies in
mapping their own pathway.
76
NASPERS
Integrated annual report 2023
NASPERS
Integrated annual report 2023
77
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Sustainability review continued
People
Our people are the heart of our business – they underpin our success. We are dedicated to helping our
people develop their full potential by creating a diverse, inclusive and learning organisation.
Employee value proposition
Interesting
work
Opportunity to
learn and grow
Employee
wellness
Great
leadership
and culture
Competitive
pay and
benefits
Our employee value proposition
Our people seek meaningful jobs with line-of-sight to business
outcomes and the opportunity to learn and grow
professionally. We enjoy working in a purpose-driven
environment, where we are recognised for a job well done
and are fairly paid in line with personal and company
performance. We care for and connect with our people,
particularly in times of need.
Interesting work for our people
We are dedicated to helping our people be their best by
enabling a culture built on diversity, inclusion and learning.
We face the global shortage of digital talent every day. The
best people have many choices about how and where they
work, and who they work for, so our employee value
proposition is critical to attract talent that ensures the
continued growth and success of our business. As such, we
focus on:
» Offering meaningful jobs with a sense of purpose in a
company committed to deploying technology to address big
societal needs and to enriching the communities in which it
operates.
» Delivering career-enhancing professional development and
ongoing opportunities to network, learn and collaborate
internally and externally.
» Recognising excellent work with fair and competitive
rewards, enabling us to compete for talent with global,
regional and local consumer internet companies.
» Putting positive, engaging and inclusive culture and
leadership at the heart of everything we do, in an
environment where many different types of people feel
happy and are able to do their best work.
Opportunity to learn and grow
We make learning accessible everywhere, at any time.
MyAcademy – our online hub connecting our people to
learning materials – is available on demand to everyone in the
group.
Our people development programmes focus on four key areas:
» Reinforcing the leadership pipeline and accelerating the
growth of top talent.
» Driving a performance culture.
» Supporting the ongoing development and growth of our
businesses by equipping our people with core consumer
internet and digital media skills.
» Accelerating major transformation plans requiring large
population upskilling such as artificial intelligence,
diversity and inclusion, and sustainability.
We have curated the very best learning experiences from
providers around the world, including our own education
partners. The flexibility of the MyAcademy web-based technology
allows rapid and efficient deployment across the group.
Monthly active learners
14 000
12 000
10 000
8 000
6 000
4 000
2 000
0
5
7
4
2
1
5
4
8
9
3
6
3
7
7
5
7
6
5
5
8
8
9
5
0
9
5
9
2
8
4
2
8
9
9
4
3
8
6
0
0
0
1
1
7
8
8
9
7
6
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●
2022
●
2023
78
NASPERS
Integrated annual report 2023
Limitless learning
We care deeply about providing equal learning opportunities
to our people, especially in geographies where access to
learning is hampered by the lack of local infrastructure and
resources.
To illustrate the flexibility of our digital learning platform,
we supported the group focus on cybersecurity by launching
programmes that equip people with an understanding of
associated threats.
We also explored learning formats that more closely resemble
face-to-face training sessions by expanding our live digital
training offering. In 2023, we organised four My Academy
‘unplugged’ live sessions inviting external speakers to talk
about sustainability and inclusion. This new format allows us
to simultaneously connect hundreds of employees with
recognised external experts on some top group priorities.
Strengthening our capabilities on topics critical
for growth
Technology training is one of the most popular development
areas on MyAcademy. We also use the platform to accelerate
and strengthen our capabilities on other topics critical to our
growth – from leadership and management skills to personal
development and cross-cultural training.
Our live education programmes focus on leadership,
management, business development, artificial intelligence (AI)
and machine learning (ML). These sessions bring people
together from across the group, enabling them to learn from
each other, share best practice and interact with the best
trainers and facilitators in their field. We will continue to
introduce our leaders to the latest innovations so they can
translate them into practical business initiatives.
MyAcademy is also a critical element in our AI and ML
transformation plan. We use it to train people who are not in
engineering roles in AI and ML, through our AI for everyone
course. MyAcademy has enabled 105 technology colleagues
to earn AI nanodegrees and initiate a new career path in the
field. In addition, our AI for growth programme equips
business leaders with the skills and knowledge they need to
build AI-centric businesses.
For more information on AI and ML, see page 86.
27 573 (2022: 28 300) permanent employees in some
80 countries and markets.
Headcount by region (%)
1
28
2
8
Asia Pacific
Europe, Middle East and Africa
Latin America
United Kingdom
United States of America
61
2 280
16 955
7 788
100
450
8%
61%
28%
1%
2%
Total
27 573
100%
Headcount by segment (%)
3
3
8
12
16
19
Etail
Food Delivery
Classifieds
Payments and Fintech
Print
Edtech
Other
Corporate
Total
1
38
10 366
5 210
4 500
3 447
2 167
859
750
274
38%
19%
16%
12%
8%
3%
3%
1%
27 573
100%
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Integrated annual report 2023
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Sustainability review continued
Employee demographics (%)
Global group demographics (%)
54.8
45.2
60
50
40
30
20
10
0
50
40
30
20
10
0
43.7
45.3
Female
Male
Females globally
●
2022
●
2023
Great leadership and culture
Cultivating a strong groupwide culture
Employee experience
Focusing on gender diversity
We are a diverse group of global companies, but our values
(see page 7) are consistent for our people wherever we
operate.
Building a diverse and inclusive workplace
Building a diverse and inclusive workplace is a key element
of our business growth and success strategy.
Given the scarcity of talent in the consumer internet industry
and our focus on growth markets, attracting and retaining
talented and qualified candidates is an ongoing challenge.
We are addressing this with talent sourcing and acquisition
strategies designed to attract a diverse range of people who,
in turn, represent the full diversity of our customer base.
Our approach is based on three interdependent pillars:
» Top leadership support: Our leadership team champions
these initiatives. Diversity and inclusion is a business
strategic priority, and a measurable goal for management
teams. For more information, see pages 80 to 82.
» Employee experience: All the different experiences
individuals can have during their journey with our group.
» Shared responsibility: To ensure we create a truly inclusive
workplace, and that we have the right impact on society,
we all have a responsibility to encourage diversity
and inclusion.
We face the same challenge as our consumer internet
competitors in attracting and retaining female talent,
especially for product and technology roles. Our initiatives
to address gender diversity specifically span the employee
journey and all levels of the organisation.
We track gender representation at every stage in our
recruitment process, and use data to ensure our recruitment
pipeline is more balanced. We review our job descriptions
and our communications with candidates to ensure the
language we use is inclusive, and there is a diverse
interview panel.
From board to senior management and the general employee
population, there is an upward trend in hiring women, as
reflected in the last four additions to the board. In addition,
more women are being recruited into management roles
across the group.
To ensure the gender balance of our board members, we are
committed to a minimum of one third of board members who
are female.
See page 124 for our board diversity policy.
Involving our employees
We assess our progress in building an inclusive workplace by
asking all our people for their feedback in our annual
engagement survey. Monitoring the results enables us to
understand if we are making the positive impact we want, and
the results this year show great progress. We also include the
topic of building an inclusive workplace in our leadership
development programmes to reinforce its importance.
We are committed to creating working environments that are
free from harassment of any kind. We have provided training
and education to all our employees on our zero-tolerance
approach to harassment, and guidance on how to raise any
concerns.
In our March 2023 employee engagement survey, we reached
a global score of 83% favourable responses to our gender
diversity question. We achieved a score of 86% favourable
responses to our inclusion question, stated as: ‘I feel respected
at my company’. We see no significant difference in results
between genders for these questions. We believe employee
feedback is a good indicator of our impact and progress
towards greater diversity and inclusion in the workplace. We
recorded a 3 percentage point reduction in our global
engagement result in FY23. Employee sentiment was impacted
by workforce restructuring during the period. We remain
committed to improving employee engagement and will
continue to focus on that in the new financial year.
Competitive pay and benefits
Fair pay
Equality and consistency are embedded in our pay practices
across the group as we build diverse and inclusive
workplaces. We operate in high-growth economies where
socioeconomic disparity can be large, and societal fairness
is very important to us. We ensure our pay practices around
the world are fair, competitive and above minimum-wage
standards.
Our commitment to pay for performance and alignment with
shareholder value creation drives all our reward activities and
supports the ownership mentality and spirit of
entrepreneurship in our teams around the world.
Our fair remuneration systems are:
» Equitable: Free from discrimination.
» Relevant: Linked to personal and company performance.
» Rational: Easy to explain.
We strive to pay fairly and responsibly. As far as possible,
the structure of our pay is consistent, regardless of seniority,
ensuring equality of pay across our businesses.
We are committed to ensuring that the companies we invest
in have fair pay and working conditions for delivery partners,
irrespective of the classification of their engagement, which
varies across the globe.
Full-time active drivers for iFood, Tazz (an eMAG
group company) and Mr D (a Takealot group
company) on average earn more than the
prescribed minimum wage in the countries where
they operate.
Our companies provide a range of benefits to
drivers, which varies by country, such as: health
insurance/life insurance benefits, and access to
driver education, as well as low-cost access
to safety equipment (such as helmets and
protective clothing).
Ensuring pay equality
We believe in equitable pay for performance – rewarding
people fairly for performance aligned to shareholder
outcomes. As such, reward is designed to incentivise achieving
strategic, operational and financial objectives, in the short and
long term. In addition, we design our reward system to attract
and retain the best diverse talent around the world, fairly
and responsibly.
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Sustainability review continued
To ensure equality, we offer similar pay, bonus and long-term
incentives for similar jobs and performance levels, make fair
and consistent pay decisions and apply objective and
measurable pay differentiation. We do this regardless of race,
gender, sexual orientation, religion, colour, nationality or
disability. We ensure equality at every step, from hiring to
placement to progression.
Maintaining pay equality is embedded in our ways of working:
» We run regular pay-equality analyses, for example for new
hires, to identify any unintended or possibly biased
differentiation in pay.
» We perform calibration exercises across the group as a
standard process before we make reward decisions so that
we can proactively redirect if needed.
Employee wellbeing
We believe happy and engaged employees create satisfying
customer experiences. It is important in a competitive global
market that we give our people a compelling reason to work
for Naspers. We regularly measure employee engagement
across the group and ask our people for feedback on their
experience of working at our group companies. Our
businesses actively encourage participation in our employee
engagement survey, address issues raised and share best
practices.
In our last engagement survey in March 2023, we
maintained our participation rate of 83% and had an
engagement score of 71%. Although these results are lower
than last year, they are still in line with external benchmarks
and we continue to focus on positive employee engagement
across the group.
Throughout this last survey, we noted an increase in our
wellbeing and hybrid work factors versus the last survey done
in FY22. The most significant increase is focused on the teams’
feeling of spending enough quality time with others, showing
the direct impact of our blended work approach.
Statistics
Engagement survey
participation rate of 83%
Engagement score of 71%
Digital inclusion
The digital divide remains a fact in many countries where we
operate. We are committed to investing in and scaling digital
services and technologies to address global challenges at a
local level.
As a global consumer internet group, we advocate for the
benefits of widespread digital access. Our family of digital
services companies is removing physical barriers to
ecommerce, food delivery, financial services and education.
We build companies with a strong market presence that use
digital technology to improve the daily lives of billions of
people. Businesses across the group offer access to online
services that enable financial transactions, buying and selling
goods, food delivery and education.
Our companies also support targeted inclusion of underserved
individuals in the community through community investment
initiatives.
Innovation
Our core segments include global leaders in the delivery of
virtual essential services, with an improved environmental
footprint and lower emissions than brick-and-mortar
businesses. We are deepening our understanding and
quantifying how digitalisation helps the world transition to a
low-carbon society. In FY23, we initiated life-cycle analysis
projects to help us quantify the impact of digital services
compared to offline, analogue and physical services.
Our strategy for digital services places particular focus on
software-led innovation. We are rigorous in our capital-
allocation process while actively searching for exceptional
entrepreneurs to develop scalable, sustainable technologies
with breakthrough potential to address serial global
challenges.
Product innovation is a critical priority. With the support
of a dedicated product and growth operations team, our
companies build solutions based on proven agile software
development principles, quantitative and qualitative user
research, iterative usability design, and extensive A/B testing
and experimentation.
Our development teams measure the results of their innovation
via increased consumer engagement (eg time spent, long-
term retention) and improved customer satisfaction (eg net
promoter score).
Innovating through artificial intelligence
AI is at the heart of much of our innovation. Across the group,
we focus on finding new ways to innovate our business
platforms, processes, products and services.
Innovation for a circular economy
We recognise the role of innovators in tackling social and
environmental issues, both within our group and in
partnerships. Across the group, we encourage investees to
forge partnerships that foster innovation and tackle shared
societal challenges.
Packaging innovation supports sustainable
business. In line with our circular-economy
ambitions, iFood is pioneering new forms of
sustainable and biodegradable packaging for
meal deliveries. In partnership with GrowPack,
iFood is injecting thousands of compostable
packaging from waste materials into the market,
to help restaurants and customers adapt to new
sustainable materials.
Our OLX platforms already built a more
sustainable world through trade by selling second-
hand goods, a pillar of the circular economy. Each
year, OLX quantifies its positive impact through an
impact report, which details the prevented
environmental impact of seven categories (cars,
motorcycles, car parts, mobile phones, laptops,
TVs and tablets). OLX teams have piloted new
ways to fuel circular consumption and inspire the
large base of customers to reuse, refurbish and
recycle what they have through trade.
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» In the payments business, the rapid acceleration of
digital payments due to Covid-19 has increased online
fraud as well. Data and AI are used to control fraud losses
incurred by PayU and its customers (online merchants and
banks). In FY23, we deployed AI models to detect
anomalies in transactional patterns for potential fraud
alerts. We also supervised ML models to predict fraud
conducted by online merchants and others. In India, faced
with the rise of unified payments interface as a payment
instrument, fraudsters have devised new ways to conduct
digital online fraud.
» PayU also uses data and AI to provide a frictionless
online payment process for end users. In FY23, we
enabled a one-click checkout for non-risky transactions in
regions where local regulations do not mandate two-
factor authentication.
Given the increased use of data and AI, PayU further
improved data governance in FY23. Centralised data
warehouses that store, maintain and enable permissible use
were created, adhering to data governance regulations and
practices (eg localisation). While AI governance regulations
and best practices are still evolving across the globe, PayU
took further steps in FY23 via limited implementation of the
EU’s independent high-level expert group on artificial
intelligence (EU AI-HLEG) framework in selected AI models
incorporating learnings from the internal audit of the
framework in FY22. Data and AI governance will remain a
foremost priority in coming years.
Looking ahead
As the pace of innovation accelerates, we will remain
focused on finding, developing and applying new ways
to achieve our purpose.
Building the evidence base to demonstrate how our
technology investments can generate net benefits for
the planet and its people is a central strategic
objective. Accordingly, we are ramping up our initiatives
to communicate this impact to all stakeholders, and to
capitalise on opportunities to advocate effectively on
the basis of our experience.
In tandem with our sustainability policy and our
environmental programme, we will embed processes for
supplier selection and screening according to ESG
factors. In FY23, our emphasis shifted from risk
assessment to embedding ESG criteria in our
procurement.
Enhanced environmental disclosure is a key element of
our commitment to net zero, and a demonstration of the
importance of climate stewardship across the group.
The group’s commitment to achieve net-zero emissions
is embedded in the key performance indicators for our
group chief executive and the segment CEOs who
report directly to him.
We will continue to make meaningful investments
in local communities where our businesses operate, in
ways that improve lives by nurturing systemic and
sustainable change.
The group is working continuously to increase exposure
to financial revenues from sustainable business models
while enhancing disclosure and reporting standards
across our portfolio. Understanding the environmental
and societal impact of our businesses is fundamental to
guide investment and decision-making at all levels.
We anticipate that our data-driven sustainability strategy
and transparent approach will bring new opportunities
for investment, driving innovation and the discovery of
breakthrough technologies in years ahead.
Sustainability review continued
PayU: Using data, AI and ML
in the right way
We are committed to using
data, AI and ML in a
responsible and ethical way.
This objective is being
supported by our defined
governance model and
responsible AI frameworks.
PayU’s global personal-data governance policy focuses on
accountability and responsible use. Backed by appropriate
global training and awareness raising, we have created
PayU’s privacy and security-by-design policy and toolkit to
embed robust privacy and security requirements across the
business. The team also developed a benchmarking and
privacy control engine and worked closely with the Wibmo
team to obtain the ISO 27001 and 27701 (privacy)
certifications.
In FY23, PayU accelerated the adoption of data and AI
across its credit and payments businesses. This is core to
running each business, delivering on growth targets and
controlling risks:
» In the credit business, PayU (much like other credit
companies) relies on data and AI to assess consumers’
credit risk before making a lending decision. This includes
the permissible use of data provided by third parties, such
as credit bureaus, depending on the region.
» Data and AI are also crucial in other facets of PayU’s
lending products and customer experience. Examples
include simplifying customer onboarding when applying
for a loan; enhancing customer retention and reducing
churn; and determining the need for different lending
products and increasing cross-sell of products.
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Artificial intelligence
As a global tech business, AI is essential for us. We ensure we
develop and deploy it as quickly as possible across the group
to support business growth, to innovate, and to improve our
competitive ability. And we seek to always do this in the right
way – by design, ethically and responsibly.
Applying AI to improve everyday life
Across the group, we apply data science and AI in numerous
ways to add value for customers, partners and the business
and to fulfil our purpose. This includes better product
recommendation, fraud prevention, content moderation,
logistics optimisation and more. We also use AI to develop
new products and concepts across our segments, such as
content creation and search in Edtech.
Our guiding principles
The following principles guide how we develop and deploy AI:
» Deploy AI everywhere where it makes business sense.
» Develop AI-by-design for innovation in products and services.
» Develop and deploy AI ethically and responsibly.
Embedding AI across the group
Led by the Naspers AI team, we are embedding AI across the
group. The central team works closely with company AI teams
on multiple initiatives. These include organisational changes
to support the adoption of AI and data science at scale; talent
and leadership development programmes; actively engaging
with the global research and development community;
adopting machine-learning platforms in engineering;
developing deliberate data strategies; and investing in
AI-first companies.
Across the group, AI has become part of the fabric of our
operations, how we innovate and keep improving. At the scale
we currently operate across our core segments, AI is essential.
OLX, for example, has developed AI to calculate return on
investment (ROI) for marketing costs, a large cost item for
Classifieds. AI models are used to attribute ROI to single
campaigns, and optimise spending and trade-offs between
campaigns. On aggregate, they achieved a 15% reduction of
marketing costs for the same marketing effectiveness. iFood
has developed similar initiatives to reduce marketing and
acquisition costs without impacting effectiveness. Across our
segments, companies are mature in their use of AI and
increasingly apply deep-tech at scale for business success.
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Developing AI-by-design
Using AI responsibly
We are increasingly focused on AI-by-design – using our
technologies and expertise to make operational improvements
and to radically change the way we do business. This is about
future-proofing and innovating – building AI into the earliest
stages and making it core to the process of exploring,
designing, developing, deploying and improving platforms,
products and services.
Allied to this, we systematically explore emerging technologies
and accelerate them across the group, but within the
parameters of our risk management processes. The aim
is to push these technologies forward through the group
while de-risking them – to get more value, faster.
A major recent development in the field is generative AI
(GenAI) or systems that can generate new content – or
manipulate existing content – based on text instructions.
GenAI is relatively new (the first usable models date to 2019)
but current capabilities are already of practical use at scale
and exceed average human performance at many tasks. We
have developed PlusOne, an AI assistant based on GenAI,
and made it available across the group companies. With
PlusOne, companies can explore and understand the
capabilities and limitations of GenAI first-hand. It is particularly
valuable for testing use cases and discovering new
applications.
The range of possible use cases is vast and includes several
workflow automations that increase efficiency and reduce
costs. Examples include: to create education content, answer
knowledge questions, automate transcriptions and meeting
notes, create document summaries, generate and correct
code, and generate images for communication. The first set of
use cases of GenAI is already in production across our Edtech
companies.
Our models must be robust, so that they operate predictably
within known boundaries of reliability. They must be unbiased,
so that they do not discriminate, for example on gender. They
must be transparent, so that their outputs, for example an
AI-based credit decision, can be clearly explained and
understood.
We have a framework that proactively includes the social and
ethical dimensions of AI in the development process, based
on key principles:
» Govern: Anchor AI to core values, ethical guidelines and
regulatory constraints, for example specifying principles
in developing fair and responsible AI.
» Design: Design for privacy, security, transparency, bias,
robustness. For example, engineering training on how to
make models more robust and explainable.
» Monitor: Auditing for accountability, bias and cybersecurity,
such as adopting tools for bias check as part of model-
development practices.
» Train: Prepare and equip our people to take full advantage
of AI and new workstyles. This includes upskilling
engineering teams on robustness validation as part of the
testing process.
We are deploying this framework across the group.
Programme statistics
>500 data scientists now
part of the Naspers AI
community
>4 000 software engineers
and technical staff who work
with the PlusOne AI assistant
Operationalising ethical and responsible AI
We take an operational approach to ethical and responsible
AI, focused on adopting best practices across our data
science community. We develop or adopt tools and practices
designed to check the quality and representativeness of data,
to detect bias in decisions based on the models, and to trace
back the cause of bias, among others. We have adopted
specific tools for this purpose.
By using PlusOne, we have also identified guardrails and
practices that help GenAI models produce helpful and honest
responses that are not harmful. These guardrails are
continuously evolving and integrated in our technology stack.
We also focus on raising awareness through demonstrations
and technical education to ensure these tools are adopted
and used effectively.
In FY23, we articulated our statement on ethical AI at Naspers,
which describes our approach to using AI across the
businesses we invest in. We will also continue associated
training for our leaders and technical teams, as summarised
below:
» Educating leadership on ethical and responsible AI
Since 2021, a rolling programme is educating leadership
across the group on ethical and responsible AI. Throughout
the programme, leaders can see the potential of AI to
implement their company’s ambitions while developing fair,
robust and transparent AI. In this way, ethical and
responsible AI becomes an opportunity for positive impact,
not just an element of managing risks.
» GenAI deep dives for leaders
We have designed and introduced a new rolling
programme of deep dives into GenAI. They map the
evolution of the field, educate and create awareness
of the potential and limitations of Large Language Models.
We regularly offer deep dives into senior staff of group
companies.
» Training engineers in AI
We offer highly specialised training on several AI themes
for engineers and product managers, including model
deployment, ML pipelines, ML operations and natural
language processing. A new addition is a series of tutorials
and practical education modules on GenAI, such as
prompting or training language models.
Providing guidelines and sharing best practice
We have established internal privacy guidelines for our AI
teams to ensure compliance with the requirements of the EU’s
General Data Protection Regulation (GDPR). In addition, our AI
ethics working group meets monthly to manage workstreams
designed to advance ethical and responsible AI across the
group and help integrate ethics best practices into projects.
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Advancing our AI knowledge and capabilities
Throughout the year, we continued to develop our community
of data scientists across the group. The Naspers AI community
now includes over 500 data science and AI engineers. This is
a valuable platform for growing and sharing knowledge and
capabilities across the group. We organise technical and
scientific workshops for this community, connect data scientists
working on similar initiatives, share practices, tools and
lessons learnt across businesses. In November 2022,
we organised the third global Prosus AI Marketplace For
Knowledge. This three-day event for the AI community enabled
us to identify and share areas of excellence and best practice.
The focus of this edition was on GenAI applications for
the group.
Investing in seed-stage AI companies
We continue to monitor seed-stage AI companies pioneering
AI-first innovations in areas such as robotics, language and
vision. We collaborate with the Creative Destruction Lab, a
global network of universities that are accelerators for these
early-stage companies. We have invested in four AI-native
businesses so far. By taking small stakes in companies
exploring these and other advances, we are able to buy into
early-stage innovation, extend our network of expertise,
advance our knowledge, and see the business potential for
our group that much sooner. Getting in early enables us to
both accelerate and de-risk our AI innovation.
Partnering for positive impact
We partnered with Amsterdam Data Science, a network of
academia and industry that has established a strong data
science and AI ecosystem in Amsterdam. Aside from
supporting the organisation, our contribution includes
organising knowledge-sharing events such as workshops
and meet-ups.
We engage with several data-science-for-social-good
initiatives, dedicated to adopting AI in projects with a positive
social impact. We contributed to academic institutions and
non-profit organisations for developing data-science-for-social-
good education schools, such as Deep Learning Indaba – the
African ML and AI community – and Data Science for Social
Good (DSSG) – the summer school at Carnegie Mellon
University. DSSG is designed to train promising young
scientists to apply their skills to problems for a positive
social impact, for example reducing unemployment, increasing
access to education and improving environmental quality
in urban areas.
Looking forward
We will continue to develop and deploy AI to drive
improvements throughout the group. The opportunities are
endless, not least because of the focused improvement
at the heart of AI and ML, and new options offered by
GenAI. As models are deployed more widely as they
progressively learn and evolve, they tend to get better in
their understanding and decisions, with the critical proviso
that they are designed and developed ethically and
responsibly for positive impact.
This remains our focus. AI is core to what we do and how
we do it, and we are determined to use it as widely and
as well as possible – making better and better use of AI,
to improve everyday life for billions of people around
the world.
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Cyber-resilience
Incident
and crisis
management
Risk
management
Backup
management
Asset
management
Threat
intelligent
Cybersecurity
Identity
and access
management
Continuous
monitoring
Security
awareness
Log
management
Security
development
We are committed to ensuring our businesses are sustainable
and resilient, so that they can keep operating long term and
recover fast if disrupted. This is vital for our customers,
shareholders, for the group, and for the businesses
themselves.
Accordingly, we focus on two key areas of cyber-resilience:
» We implement and maintain strong cybersecurity, so attacks
are thwarted and any breaches quickly tackled with the
minimum impact.
» We enhance the resilience of our platforms and systems, so
they are available 24/7, provide consistent levels of service
and give businesses the scope to scale and innovate as
they like.
Platforms
Platforms are our consumer products – without them, none
of our businesses can operate. These platforms are often
complex, handle millions of transactions and grow rapidly
with our businesses.
Our businesses operate in fiercely competitive industries
and markets, changing regulatory requirements, and
adaptive attackers requiring continuous innovation to thrive.
Technology sits at the heart of their growth.
Business IT
Our businesses use technology to run their internal processes.
This technology is often not customer-facing and the primary
users are our employees. Output from these business IT
systems is used for operational and strategic decision-making,
monitoring performance, managing risks, and preparing
information for external stakeholders. We work with internal
departments to ensure these systems are secure and reliable.
We focus on four key areas to build and maintain sustainable
and resilient platforms and systems:
» Availability of the platforms.
» Quality and innovation of the platforms.
» Security and safety of the platforms.
» Security and reliability of business IT.
We encourage all subsidiaries to assess and report on their
risks across these four areas, so we can gain a clear, coherent
view and in turn analyse, respond and advise effectively.
At group level, we now report against these areas as part of
our ongoing risk management.
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Our cybersecurity policy
The board sets our group cybersecurity policy, which has four
key parts: good governance; good protection; good detection;
and good response. This is the backbone of our robust
approach. In line with the governance framework, we cascade
the policy through the segments to the underlying businesses,
giving them ultimate responsibility for ensuring they implement
strong cybersecurity in line with their own operations and
challenges. For example, we expect each business to have
the right level of incident management and crisis
management to ensure a good response to any security
incident.
Supporting from the centre
Our central cybersecurity team provides expert help and
support to the segments and businesses. As part of our risk
and audit function, the team’s approach is to help develop a
competent, agile community of cyber and risk professionals,
based on guiding principles:
» Cyber is an enabler, not a blocker.
» Help manage risk, not spread fear, uncertainty and doubt.
» Every employee is a cyber-warrior.
Every month, the head of cyber hosts a round-table discussion
with the security heads of the subsidiary companies. It is an
opportunity to share updates at a group level and for the
business leads to discuss key initiatives and issues, such as
the nature of the latest cyberthreats or developments on the
dark web.
Creating a strong cybercommunity
As a decentralised group, it is important that we cultivate a
strong cybercommunity. Accordingly, we have established an
online workspace for security professionals to stay in touch,
discuss trends and risks, and co-ordinate responses to
incidents. Other initiatives include an online cyber-academy
where the community gets together and shares insights and
best practice. We also host regional cyberlabs, which are
two-day events where security teams from subsidiaries in the
region gather to discuss emerging risks and common
response strategies. In FY23, we had two cyberlabs, in Brazil
and India.
Assessing cyber-resilience
The cybersecurity team undertook 49 advisory and assurance
projects in FY23 to ensure cybersecurity and technology risks
are managed by our businesses.
Our advisory projects for group companies include hiring
hackers to break in (ethical hacks), forensic work to investigate
breaches, and cloud assessments to improve cloud set-up and
solutions.
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We also conduct formal internal audits – independent
assessments of a company’s security and resilience for
assurance.
Governance and reporting
The cybersecurity team reports to the risk and audit
committees four times per year, sharing updates across the
five technology risk categories. On two occasions, it presents
an in-depth report on how well the businesses are doing
against the policy.
Reports to the risk committee include a comprehensive
overview, with key risks, greatest challenges and any major
incidents. This is also where any major issues are escalated.
Formal audit reports are provided to the audit committee.
In addition, every quarter, the head of cyber meets with the
head of risk and audit and group CFO to discuss the most
important cybersecurity and technology issues, where to focus
in months ahead and any notable incidents.
Last year, we introduced risk dashboards. They enable the
group to monitor how quickly and effectively businesses are
addressing and resolving risks identified by the central team.
This in turn forms part of the report provided to the risk and
audit committees, per segment and per business.
Key cyber-resilience services
Our central cybersecurity team provides a range of services
to subsidiaries. These include risk-driven process reviews;
data-driven deep dives; security testing; resilience exercises;
and managed services.
Focusing on critical issues
Throughout the year, the team helped the business focus
on two critical issues:
» Secure remote working. As people continue to work from
home post pandemic, making sure they can do so securely
remains a priority. As such, end-point security remains a key
part of the cyber-resilience agenda, and we work with
businesses to check that this is in place and robust.
» Ransomware prevention and response preparation. This
included updating our cybersecurity policy with a ransomware
addendum; creating a group playbook on how we would
respond to a ransomware attack; and undertaking
ransomware simulations, so we could further refine our
resilience to this growing threat.
In FY23, we performed internal audits at multiple subsidiaries
to ensure they have sufficient resilience against a ransomware
attack.
Programme statistics
Cybersecurity team
undertakes around
49 advisory and assurance
projects each year
We executed 2 advanced
persistent threats (APTs)
We executed
7 red team exercises
We did
4 pentests
Key performance indicators
At group level, we focus on two cyber-resilience key
performance indicators (KPIs):
» Breaches: Our procedure requires subsidiaries to notify
us about numerous categories of notable incidents
(cyber-attack or other operational failures of the platforms).
We report to our risk committee about these when they are
material, in particular noting the nature of incidents, risk of
financial losses, and whether notifications to regulators or
investigative bodies have been made. We make
recommendations for corrective actions where appropriate.
Similar to FY22, we had no breaches of subsidiaries that
had a material operational or financial impact above
US$10m in FY23.
» Awareness: Every new group function employee now has
security awareness as part of their induction, and we do a
periodic phishing simulation at corporate. We saw good
results from the last rounds of phishing simulations.
Looking forward
We will continue ensuring the availability, quality, security
and safety of the platforms and systems our businesses
rely on. Ransomware remains a significant threat and we
will increase our focus on that risk.
We are also closely monitoring and researching new risks
coming from GenAI, both its use in launching new types
of cyber-attacks, and in helping us to quickly identify and
respond to an attack.
We will continue investing in the cybercommunity and
create opportunities for subsidiaries to collaborate.
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Groupwide policy
Supporting and monitoring
Investing in expertise
Sustainability review continued
Data privacy
Our commitment
We recognise that privacy is an important value and an
essential element of public trust. At Naspers, we strive to be a
trusted company and, as a responsible investor, we expect
each of our businesses to adhere to our group policy on data
privacy governance.
Public trust is a precondition to achieving our purpose
to improve everyday life for billions of people through
technology. Data privacy is also a material domain for
our group in support of our sustainability initiatives.
Data privacy principles at Naspers
1 Notice
We offer appropriate notice about our data privacy
practices.
2 Individual control
We honour data subjects’ choices about their personal
data within the bounds of technical feasibility and
reasonability.
3 Respect for context
We recognise that data subjects’ expectations about fair
and ethical use of their personal data are informed by
the context in which their data was first collected.
4 Limited sharing
We limit unnecessary personal data sharing with
third parties.
5 Retention
We retain personal data only for as long as we need it.
6 Security
We ensure appropriate security.
7 Governments
We engage with governments responsibly.
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Our policy on data privacy governance sets out responsibilities,
principles and our programmatic approach to ensuring data
privacy is implemented in each company of the group. It is
designed to define and document how data privacy is
managed; promote best practice; accommodate the different
business models, resources, culture and legal requirements
across the group; and support trust in our businesses’ products
and services. We review this policy each year.
For more information refer to our website at
www.naspers.com/privacy.
Clear accountability
We give clear accountability to individual businesses. Each
business is directly responsible for managing its data privacy
programme. This responsibility rests ultimately with the CEO of
each business – they lead in implementing the group’s policy
and are directly accountable for data protection programmes
and privacy standards in their organisations. This approach to
data privacy aligns with our model of decentralised
governance and broader belief in encouraging great leaders
and businesses to excel. We strive to foster a culture of data
privacy and look to businesses to ensure privacy by design –
where privacy becomes part of the fabric of day-to-day work
rather than an add-on.
The key inputs for ensuring robust data privacy across the
group are summarised below:
Data privacy principles
Widely recognised internationally and benchmarked to
fair information privacy principles, the seven data privacy
principles are guidelines for the responsible use of data.
Critically, they are both universal and able to be applied to
the different businesses in the group – from established global
players to start-ups in jurisdictions that may not yet have data
privacy laws.
Key elements of data privacy programme
To help businesses put the principles into practice, our
group policy sets out seven key elements of a data privacy
programme and ensures our core data privacy commitment
and approach are followed in ways that really work for our
businesses, benefiting each company and the group as a
whole. It also ensures that businesses comply with applicable
data protection laws, such as General Data Protection
Regulation (GDPR) in Europe, General Personal Data
Protection Law (LGPD) in Brazil, and Protection of Personal
Information Act (POPIA) in South Africa, and lays the
groundwork for strong technical competencies to comply with
anticipated requirements of future digital laws, such as those
in India.
This is our programmatic approach to ensuring robust data
privacy across the group.
The group’s data privacy office supports and monitors the
businesses. This includes guidance on implementing the data
privacy programme; training programmes that develop future
privacy leaders; and advice on any data privacy implications
of mergers and acquisitions. In turn, each quarter, companies
report to the group privacy office on progress in developing
their privacy programmes as well as incidents and interactions
with government authorities, customers and their partners. In
addition, we have implemented a bespoke Naspers privacy
maturity model that allows each company to monitor the
maturity of their privacy programmes across 17 domains,
focus on key areas for improvements, and report results
in a consistent manner.
Our intra-group data transfer agreement is designed to
streamline how our companies navigate the complexities and
risks involved in international data transfers among affiliated
companies, to ensure they comply with the latest regulations
in this area.
Advocacy on privacy and related digital legislation
We closely follow developments in data protection, data
strategy, AI ethics and other key issues relevant to digital
platforms. We ensure our companies stay at the forefront of
discussions that impact the use of data in their businesses.
This includes advocacy and thought-leadership work in
support of relevant legislation in diverse jurisdictions.
Governance and reporting
The board has direct oversight of data privacy, including
subsidiaries. The group encourages associates and investees
to participate in the data privacy programme.
Twice a year, the group data privacy office submits a detailed
report to the risk and audit committees. It aggregates the
group risk assessment together with recommendations for
focus areas in the segments, and includes detailed segment-
level reporting, based on the Naspers privacy maturity model.
In addition, our group chief executive directly reviews the data
privacy programme outputs each year.
Three KPIs
To monitor the data privacy outputs that flow from our
companies in line with the inputs we provide as a group, we
have set three KPIs, specifically around privacy workforce;
auditing; and maturity measurement.
We require that companies appoint their own privacy leads.
We track the level of investment in data protection officers,
deputies, regional privacy leads, privacy managers and other
experts. The growth of this privacy network drives the strength
of privacy programmes in our subsidiaries. This enables our
businesses to address the increased requirements stemming
from digital regulation and pending data protection legislation
(for instance, in India). In our subsidiaries, we have a diverse
team of 34 (FY22: 33) data privacy roles in nine jurisdictions
across the globe.
We also invest in data privacy skills by enabling our experts
to gain globally recognised privacy certifications offered by
the International Association of Privacy Professionals (IAPP),
as part of our group membership (56 certified privacy
professionals in the group).
India gets privacy-ready with the Naspers privacy
governance academy – this year we inaugurated
a training curriculum for our India investees,
including an intensive privacy management training
programme over seven weeks, with more than
40 participants.
We invest in automation by maintaining a group-level licence
for industry-leading privacy management software that allows
companies to automate many of the privacy reviews
undertaken across the group. We also offer multiple privacy
training opportunities and forums for engagement. In
MyAcademy, we host over 30 modules of diversified privacy
training content in different languages in a dedicated privacy
learning hub.
Auditing companies
As a group, we require that our companies are periodically
audited for data-related matters. We routinely conduct internal
audits that focus on aspects of data governance as part of
our overall risk management. Guided by the privacy team, our
internal audit team schedules and performs various types of
privacy controls, verifications and audits on subsidiaries. These
audits are a valuable way to provide both assurance and
guidance.
During the year, we conducted 38 (FY22: 35) internal audits
with data governance components, assessing issues specific
to privacy, software development life cycle, security, data
management and broader risk management.
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Sustainability review continued
Assessment of maturity and goal setting – Naspers
privacy maturity model
This year, all our subsidiaries completed two cycles of
assessment across 17 data privacy domains set out in a
bespoke Naspers privacy maturity model. Each company has
selected at least two specific goals to improve maturity over
the year, based on what was most pertinent to its business
model, size, culture and jurisdiction. All subsidiaries reported
to the group privacy office on levels of maturity across these
domains and progress of selected focus areas by the end of
the review period.
Following a reassessment process, new baselines were set for
the coming year and the board has been briefed about results
for this period. It is notable that, after our first review in FY23,
developments in the macro economy, which resulted in
changes to workforce levels and deployment of financial
resources, have on occasion impacted the ability of diverse
businesses to achieve their goals in digital governance.
However, many of the companies advanced their programmes
and improved maturity accordingly in targeted domains.
This review has enabled us to complete internal benchmarking
and set company-specific goals, as well as identify broader
trends. As a result, we can see where the challenges lie and
adapt our support and guidance accordingly, to keep
improving as a group.
Is data minimisation the new green? One of our
companies, OLX Group, has actively sought to
identify, assess and delete duplicative or
unnecessary data sets to advance its sustainability
goals, reduce costs and minimise privacy and
security risks.
Looking forward
We will continue to deploy and strengthen the Naspers
maturity model. This is a valuable tool that helps our
subsidiaries focus their resources on material privacy
governance domains that impact key stakeholders,
particularly consumers and employees. It also enables
more streamlined risk assessment, monitoring and
reporting.
Data privacy risks remain a key focus area for the group,
due to increased enforcement, new regulations and
security risks. We are working closely with the Naspers AI
team to ensure we build and deploy AI in an ethical,
responsible and compliant way, aligned with the Naspers
formal approach to AI and ethics.
While challenges remain, we are committed to a strong
groupwide data privacy programme that ultimately
benefits the billions of users of our companies’ services
and improves their everyday lives.
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Key elements of our data privacy programme
1 Executive buy-in
Senior management should emphasise the importance of
data privacy and its relationship to trust, brand, growth,
risk and compliance to their teams. The chief executive
should designate a data protection lead or team
responsible for data protection.
2 Know your data
The business should know what personal data it holds
and for what purposes it processes that data.
3 Policy setting
Business culture,
ethics and integrity
Creating long-term value
The board ensures a culture of sound business ethics and
conduct, aimed at long-term value creation that underpins the
group’s activities as a responsible corporate citizen. This
includes adopting values and a code of business ethics and
conduct (the code), leading by example and monitoring
implementation.
Sharing a strong culture
Our group values guide our culture:
» We build
» We deliver
» We’re responsible
» We value each other.
Certain policy documents should be adopted to support
implementation of privacy principles at a minimum:
These values, and the code, are the guiding principles for our
actions as an organisation.
» Consumer privacy policy
» HR privacy policy
» Security policy
» Data breach/incident response plan
4 Training employees
Privacy training that informs employees about company
policies, the principles, and how their roles are impacted
by data privacy requirements, should be part of
onboarding and/or annual training.
5 Vendor and third-party management
Where personal data sharing is permitted, third parties
should be appropriately scrutinised.
We require confidentiality and/or data-processing
agreements to ensure an adequate level of protection for
any data shared. We audit vendors on risk-based criteria.
6 Legal compliance
Legal advisers should support the business by helping to
ensure that applicable laws and their specific
requirements are met.
7 Reporting
Each business should be able to demonstrate compliance
with the principles, data privacy programme elements,
and applicable data protection laws.
Our commitment to ethics and compliance
We are committed to conducting business in compliance with
the law and behaving ethically.
Failing to comply with laws and regulations, or the codes and
standards we have adopted, could expose the group to legal
liability and affect our impact, reputation, business, financial
condition and the communities in which we operate. We strive
to apply laws and rules, codes and standards with integrity
and regard for ethical business practices in a way that
supports good corporate citizenship.
Honesty and integrity are the foundations of our reputation
and for the trust of our stakeholders: it is crucial for us to
guard that reputation and preserve that trust.
Roles and responsibilities
The board sets the tone at the top, guiding business values
and promoting the culture of sound ethics and compliance.
The board’s risk, audit, human resources and remuneration,
and social, ethics and sustainability committees exercise
oversight of ethics and compliance and the management of
related risks across the group.
The board has approved all our ethics and compliance
policies, including the code and the speak up policy. The code
sets out what we as a group expect from all employees and
stakeholders and the speak up policy encourages and
provides channels for individuals to report actual, or potential,
breaches of the code, other group policies or laws and
regulations.
Senior management is responsible for creating a culture
aimed at long-term sustainable value creation and ensuring
ethical business standards are integrated into strategies and
operations.
Group ethics and compliance is responsible for executing
effective and demonstrable ethics and compliance risk
management, specifically relating to the code, anti-bribery
and anti-corruption, competition/antitrust, sanctions and export
controls, and anti-money-laundering and counter-terrorism
financing.
In addition, group ethics and compliance is responsible for
designing and overseeing the speak up programme across
the group, including the group policy, monitoring use of speak
up services and ensuring reports are dealt with appropriately.
Approach
Group ethics and compliance has developed and
communicated an ethics and compliance framework of
minimum standards required for subsidiary businesses.
Subsidiaries are required to implement an ethics and
compliance programme that is fit-for-purpose and takes
account of ethics and compliance risks specific to
their business.
To ensure proper design and implementation of these
programmes at subsidiary level, ethics and compliance
officers have been appointed across the group. At year-end,
there were four ethics and compliance officers at corporate
level and 97 at subsidiary level (including dedicated staff and
those with combined roles).
Ethics and compliance officers at subsidiary level report
to group ethics and compliance on the design and
implementation of their programmes. Group ethics and
compliance monitors the design and implementation of these
programmes through the reporting process as well as regular
touchpoints with the subsidiaries. Group ethics and
compliance reports to the group’s board committees
biannually.
As part of our ethics and compliance culture, we encourage
employees and third parties to speak up if they have
concerns, using various available options. Concerns can be
raised locally via line managers, human resources and ethics
and compliance officers or through dedicated speak up
services available online, via a telephone hotline or by email,
24/7 in multiple languages. Speak up services allow for
confidential and, if legally permitted, anonymous reporting.
Retaliation for speaking up is not tolerated and will be treated
as a violation of our code.
The code and speak up policy are available in multiple
languages and posted on our website.
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Sustainability review continued
Progress in FY23
In FY23, we updated and enhanced a number of key group
policies, including the group’s sanctions and export controls
policy. We also issued policy-related guidance for our
segments and businesses. We continued implementing the
code and speak up programme across the group, with
training and awareness campaigns.
We refreshed and rolled out our core ethics and compliance
training to all group employees, with a 100% completion rate.
Risk assessments and annual plans were completed for each
segment, identifying key risks and initiatives for the year
ahead, informed by the risk assessment.
In FY23, 598 speak up cases were logged across the group
(including whistleblowing cases). Of these:
» 253 were substantiated (fully or partially) and remediated,
as required
» 273 were not substantiated, and
» 72 are still under investigation.
Our subsidiaries continued to make good progress in
implementing and adapting the ethics and compliance
framework in their businesses.
Looking forward
We continue to develop our ethics and compliance
strategy to incorporate observations from our monitoring
activities, emerging risks, regulatory changes and best
practices. We recognise the importance of ensuring that a
strong ethics and compliance base is embedded in our
subsidiaries, while allowing for growth and change.
Over the next year, we will continue to drive
implementation of the ethics and compliance framework
in subsidiaries. We will review and enhance core policies
to meet the evolving risks and regulatory landscape
applicable to our businesses. We will monitor progress
against subsidiary annual plans and measure the
maturity of business programmes. Our subsidiary plans
cover enhanced governance and risk mapping, policy
improvements, training and awareness, monitoring and
testing and other risk and business-specific measures.
We will continue to improve oversight of ethics and
compliance, and ensure that, as a group, we address the
relevant ethical issues by taking the right actions and
developing mitigation and prevention strategies.
Programme statistics
101 ethics and
compliance
officers appointed
across the group
100% of
corporate
employees
completed our
ethics and
compliance
e-learning
598 speak up
cases logged
across the group
Upholding human rights
Human rights give us the freedom to choose how we live, how
we express ourselves, and the freedom of political affiliation.
They are fundamental to our ability to meet our basic needs,
such as food, housing and education. Conflict, poverty, climate
change, inadequate access to education and inequitable
access to resources are among the underlying issues that
contribute to a world where human rights continue to be
challenged in both mature and emerging economies. The
global scale of the issue has been highlighted by growing
discussion on systemic racism and violence following the rise of
the Black Lives Matter movement. In turn, public dialogue has
increased on broader topics of diversity, equity and inclusion.
Our commitment
As an employer, investor and operator, our actions touch
the lives of millions of people around the world. By setting
appropriate standards at group level, we can create far-
reaching positive impact. Therefore, our approach to human
rights begins with our own operations and extends through our
value chain.
We operate in diverse geographies, each with its own historical
legacies, social demographic configurations and populations. As
a signatory to the UN Global Compact, our approach to human
rights sets out standards and principles that can be applied to
the specific issues and challenges relevant to the business
models and operating contexts of our companies.
Human rights in our operations
Our approach to human rights begins with the area where we
have the most influence: our own operations. As an employer,
we respect the fundamental dignity of our workforce and are
committed to providing a respectful, safe and secure
workplace that is free from any form of human rights abuse.
This commitment extends to the board and everyone who
works in the group.
Our human rights statement is available on our website
and is communicated to internal and external stakeholders.
It describes our approach to topics, including remuneration,
dignity at work, privacy and employee confidentiality, forced
labour, and health and safety. It also details the reporting and
governance framework in place to uphold these standards.
The human rights statement is overseen by the board, with
the assistance of the social, ethics and sustainability
committee and the human resources and remuneration
committee. Following publication of the group human rights
statement, 100% of subsidiaries have now adopted and/or
published their own human rights statement.
Companies we invest in
During our capital-allocation and investment process, we
incorporate ESG criteria, including human rights, into our
decision-making. ESG screening is built into our pre-investment
due diligence process and we vet all new investments for
potential human rights violations.
Once onboarded into our portfolio, we manage for
performance and expect our subsidiaries to apply high
standards on ESG. Since 2021, all subsidiaries have adopted
our human rights statement and are required to uphold this
standard, along with applicable laws and regulations. We
track this performance as part of our third-party ESG
performance assessment, which maps how each company
addresses ESG topics, including human rights. We are
committed to complying with applicable laws and to
respecting internationally recognised human rights, wherever
we operate. Guided by the UN Global Compact, in the rare
situation that national law conflicts with international
standards, we expect compliance with national law as the
bare minimum and seek ways to engage with the company to
promote principles of internationally recognised human rights.
We invest in diverse business segments, each with its own
human capital value chain. As part of the pre-investment
process, our investment teams include ‘potential human rights
violations’ in their broader due diligence of the non-financial
qualifiers for a company. Businesses such as the Payments
and Fintech, and Edtech companies have a small group of
employees who are mostly highly skilled technology or finance
specialists. Other segments such as Etail and Food Delivery
have a more extended footprint of on-demand platform
workers in their value chain. As a result, each company’s
approach to human rights is influenced by its operating
context and business model, while maintaining the underlying
principles. For example, food-delivery businesses work with a
large pool of drivers who are, in many cases, also external
contractors. In this case, we have introduced a groupwide
on-demand platform worker statement for subsidiaries, which
outlines principles on pay, social protection, fair working
conditions and flexibility.
Human rights in our supply chain
We recognise our opportunity to influence our supply-chain
partners through our supplier and purchase decisions. As
such, we require a commitment to minimum human rights
standards that are compatible with our own commitments from
companies seeking to qualify as Naspers suppliers.
For the past three years, we have used a third-party supplier
assessment tool. This provides a broad view of our supply-
chain risk across four risk areas identified by the UN Global
Compact, including human rights. This screening system helps
identify individual risks and allows us to continuously assess
and improve the profile of our vendor ecosystem.
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Sustainability review continued
Building supplier sustainability
We are committed to building a more sustainable supply
chain through our purchase decisions.
At corporate level, we have implemented an integrated
vendor-screening tool. We have screened all our vendors
across a range of material issues to identify any areas of
concern. The tool will be continuously deployed to assess
our current and future portfolio of vendors. Our board has set
the guiding business values and the ethical climate in our
code of business ethics and conduct which sets out what we
expect from all our employees, stakeholders and potential
investment opportunities. Building on this code, our supplier
code of conduct outlines the principles and guidelines we
expect our suppliers to follow, to remain a trusted business
partner. It asks our vendors to live up to the highest standards
on social themes and take action to reduce their
environmental impact. The supplier code governs our
commercial engagements with suppliers and is made part
of our contractual relationships. It is expected that this will
be published in FY24.
Supplier screening
Before we engage with a supplier, we screen the organisation
for its historical conduct on several elements like financial
conduct, and incidents related to human rights and
environmental management. Once this screening proves
satisfactory and all red flags are addressed sufficiently, we
can onboard or continue working with the supplier.
Community investment
Naspers has a deep-rooted history in South Africa. We are
proud of our home country and committed to improving
everyday life for its people, as we do for billions of people
around the world, through technology.
In its 2021 annual report on South Africa, The United Nations
Development Programme placed ‘youth unemployment and
the digital divide’ at the top of a list of the country’s greatest
development challenges. At Naspers, we aim to promote
increased digital inclusion for South Africans, particularly
historically disadvantaged communities, women, and people
living with disabilities. This focus feeds naturally into
addressing youth unemployment.
Our purpose of leveraging technology to transform daily life
informs our strategy of investing in programmes that promote
greater access to higher education and skills development,
enabling increased participation in the South African economy.
Recognising that skills development and training are not
enough, we also support job-placement programmes and
micro-enterprise acceleration to improve the livelihoods of
talented South African job seekers and entrepreneurs.
Naspers bursaries
Education is a key tenet of South Africa’s constitution and its
national development plan. Concerningly, a large proportion
of the population who do reach higher education drop out
primarily due to the associated costs and numerous social
challenges.
It is an unfortunate reality that poverty and inequality, together
with gender and disabilities, continue to hamper access to
higher education or skills training, leaving far too many young
people condemned to unemployment. Naspers aims to
contribute to redressing this societal challenge.
We launched our Naspers bursaries programme in 2021 to
help students obtain degrees in high-demand fields such as
STEM (science, technology, engineering and mathematics),
commerce and business science. Our bursary recruitment
platform reaches beyond urban centres to find academically
and financially deserving students in disadvantaged
communities across the country who lack the means to fund
their studies.
At the end of FY22, we had granted 82 bursaries to qualifying
candidates from first year to honours level to study at our
partner universities. In addition to tuition fees, the bursaries
fund accommodation, meals, prescribed textbooks, a living
allowance for the duration of the degree, as well as a laptop
computer (for first-year students only).
Adjusting to university life can be challenging, especially for
students from disadvantaged backgrounds. This is reflected in
high drop-out rates among these students. To help students
reach graduation and because we believe that each
individual has different needs, we partner with Tomorrow Trust.
This non-profit organisation has a long record of supporting
students’ psychosocial health through individual counselling,
mentorship, and monthly workshops on various topics to
enable their success. Tomorrow Trust also provides career
guidance, work-readiness training and a mentorship
programme for the duration of each bursary.
In the 2022 academic year, 24 bursars graduated with
honours degrees – 11 in science, 11 in commerce, one in
engineering and one in information technology.
We contribute to SDG 4 through the Naspers bursaries programme.
Naspers Labs
We established Naspers Labs to provide training for in-
demand digital skills among young South Africans (aged 18
to 34) who have relevant post-matric qualifications but are
unable to find employment. As part of our commitment to
advancing digital inclusion, Naspers Labs particularly focuses
on recruiting marginalised groups. As a result, 65% of the
beneficiaries of these programmes are young women and
4% are young people living with disabilities.
We believe that communities benefit when local businesses
bloom. Equally, although conditions may vary, we are
convinced that local action by local companies is key to
addressing societal challenges. Naspers Labs is run in
collaboration with local implementing partners, harnessing
their expertise to deliver in-demand digital skills capabilities,
work-experience exposure, work-readiness training, job-
placement support and entrepreneurship acceleration.
Naspers Labs programmes are conducted virtually and, where
necessary, we provide young people with laptops, tablets and
data to access online training content.
To date, Naspers Labs has prepared 3 956 youth to become
software developers, cloud engineers, cybersecurity
technicians, data analysts, desktop technicians, data scientists,
web developers and robotics specialists, among others.
Thanks to our extensive partner networks – including Afrika
Tikkun Services, GirlCode, and Esinam – Naspers Labs has
to date placed 3 920 young people in tech and tech-
enabled jobs.
Naspers Labs is also a strong proponent of enterprise
acceleration. As part of our total R235m investment in this
programme, we have provided business support (incubation,
acceleration and market access) to 33 young entrepreneurs,
enabling them to improve their businesses to become
self-sustaining, leverage technology and grow.
We believe that through our social impact initiatives, Naspers
is contributing to South Africa’s long-term growth and success
by accelerating digital inclusion, educating tomorrow’s tech
talents, facilitating employment for historically underserved
members of society and supporting new tech-led and
tech-enabled start-ups.
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Sustainability review continued
Managing our environmental
impact
Our environmental impact can affect our reputation, regulatory
compliance, and operational efficiency, which in turn can
impact our financial performance. As such, measuring,
managing and reporting environmental impact is crucial for us
to make informed decisions and to ensure our performance is
aligned with our values and goals.
Our environmental sustainability programme sets out our
approach to defining, measuring, and managing our
environmental impacts of our group. We have created this
document for all our stakeholders to provide a comprehensive
view of our material impact on the planet and to outline how
we address risks and capitalise on opportunities.
Climate action is listed as a key priority by stakeholders in our
materiality survey. As an investor, we are ideally positioned to
play an active role in the transition to a low-carbon economy.
We focus our climate action on three areas:
» Our own corporate operations
» Our corporate supply chain
» Our investment portfolio.
Our dedication to climate action is reflected in our ambitious
reduction and portfolio engagement targets, and we believe
our climate and environment programmes serve the long-term
interests of communities where we operate.
Our science-based commitments
In FY23, we worked on building a real-world climate transition
plan that was both relevant and practical in the context of our
diversified holdings and group structure. We developed our
targets by applying the Science-based Targets Initiative’s (SBTi)
guidance for investors, which best matches our diverse and
dynamic portfolio of investments. We are committed to a
climate journey aligned with the Paris Agreement to limit
global warming to 1.5°C.
The targets we have developed shape our absolute reduction
pathway for corporate emissions (scope 1, 2 and 3) as well as
multiyear engagement with our portfolio companies to put their
businesses on a net-zero pathway by developing their own
science-based targets, a so-called portfolio coverage target.
Applying a portfolio coverage metric of at least 50% of invested
capital, we expect and encourage the majority of our
subsidiaries to set science-based targets by FY30.
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Our science-based targets
Corporate emissions
100%
30%
Scope 1 + scope 2
emissions by FY28
Air business travel
emissions by FY30
Portfolio emissions
Majority
Majority* of our portfolio
companies set a science-
based reduction target
by FY30
* This is measured by invested capital.
Decarbonisation pathway for our corporate operations
In FY23, we implemented all necessary measures to ensure we
reach our target to reduce scope 1 and 2 emissions from our
operations (which include Naspers and Prosus corporate
offices) to zero. This target was a key metric in our chief
executive and CFO’s short-term incentives, as detailed in the
remuneration report. For our scope 1 reductions, we
implemented a programme to dispose all internal combustion
engine vehicles from our corporate office’s asset register. For
our scope 2 reductions, we implemented three core actions,
depending on the operating context of the office space.
(1) Where possible, we engaged with our leasing agency to
install on-site solar panels; (2) where available on the grid, we
procured green energy; and (3) for all remaining energy
consumption, we procured equivalent renewable-energy
certificates. Going forward, it is our intention to continue making
further progress on this pathway and increasing the ratio of
green-energy procurement to renewable-energy certificates.
Emissions from business travel are also a priority (scope 3,
category 6). Our target is to reduce emissions from flight-based
business travel by 30% by FY30. In FY23, we onboarded a new
travel agent and began using a travel management tool that
includes GHG emission calculations, giving employees valuable
information to make sustainable travel choices. In addition to
reducing emissions from business travel, we continue to invest in
sustainable aviation fuel. This short-term solution for
decarbonising air travel supports the long-term goal of
developing a low-carbon pathway for air travel.
Being a force for good
Distributed renewable-energy credits (D-RECs)
Naspers, through Prosus, has committed to buying 3GWh of D-RECs from South Pole between 2022 and 2025,
delivering 1GWh per year. This transaction – one of the first of its kind – will provide much-needed capital to
help establish transformative renewable-energy projects that displace carbon-intensive energy and give rural
communities access to energy. The deal was announced at the United Nations Climate Change Conference
COP27 in Sharm el-Sheikh, Egypt.
By purchasing D-RECs, Prosus is providing climate finance for renewable-energy projects that displace
polluting off-grid energy generation, such as diesel generators and energy from some of the most carbon-
intensive grids in the world.
D-RECs extend the impact of renewable-energy certificates (RECs) – a widely used market instrument – to
smaller projects with limited connection to the grid and/or cannot easily access financing. Renewable-energy
solutions made viable by D-RECs, like solar mini-grids, deliver clean energy to irrigation systems, healthcare
facilities, schools and homes. By improving critical services for communities, the tremendous development
potential of D-RECs contribute to UN SDGs on health, food security, education and helping to fight climate
change.
Naspers and portfolio companies’ scope 1, 2 and 3 emissions1
Naspers corporate office:
Scope 1 Emissions from direct operations (use of fossil fuels and refrigerants)
Scope 2 Emissions from purchased electricity (market-based)
Scope 3 Emissions from indirect sources (purchased goods and services)
Scope 3 Emissions from indirect sources (air travel)
Portfolio companies:
Media24
Scope 1
Scope 2
Takealot
Scope 1
Emissions from use of fossil fuel
Emissions from use of refrigerants
Total scope 1
Emissions from purchased electricity (market-based)
Emissions from use of fossil fuel
Emissions from use of refrigerants
Total scope 1
Scope 2
Emissions from purchased electricity (market-based)
tCO2e*
6
500
6 929
422
1 485
0
1 485
6 125
16 163
0
16 163
8 401
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Sustainability review continued
Prosus corporate offices2:
GoodHabitz
Scope 1 Emissions from direct operations (use of fossil fuels and refrigerants)
Scope 2 Emissions from purchased electricity (market-based)
Scope 3 Emissions from indirect sources (purchased goods and services)
Scope 3 Emissions from indirect sources (air travel)
OLX
Scope 1
Emissions from use of fossil fuel
Emissions from use of refrigerants
Total scope 1
Scope 2
Emissions from purchased electricity (market-based)
Movile
Scope 1
Scope 2
iFood
Scope 1
Scope 2
eMAG
Scope 1
Scope 2
PayU
Scope 1
Emissions from use of fossil fuel
Emissions from use of refrigerants
Total scope 1
Emissions from purchased electricity (market-based)
Emissions from use of fossil fuel
Emissions from use of refrigerants
Total scope 1
Emissions from purchased electricity (market-based)
Emissions from use of fossil fuel
Emissions from use of refrigerants
Total scope 1
Emissions from purchased electricity (market-based)
Emissions from use of fossil fuel
Emissions from use of refrigerants
Total scope 1
Scope 2
Emissions from purchased electricity (market-based)
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tCO2e*
16
67
3 848
2 134
688
0
688
3 249
0
0
0
55
1
0
1
524
12 236
366
12 602
2 686
301
63
364
1 278
Scope 1
Emissions from use of fossil fuel
Emissions from use of refrigerants
Total scope 1
Scope 2
Emissions from purchased electricity (market-based)
Stack Overflow
Scope 1
Emissions from use of fossil fuel
Emissions from use of refrigerants
Total scope 1
Scope 2
Emissions from purchased electricity (market-based)
Scope 1 emissions:
Naspers corporate
Prosus corporate
Portfolio companies
Total
Scope 2 emissions:
Naspers corporate
Prosus corporate
Portfolio companies
Total
Scope 3 emissions (category 1 – purchased goods and services):
Naspers corporate
Prosus corporate
Total
Scope 3 emissions (category 6 – air travel):
Naspers corporate
Prosus corporate
Total
* tCO2e: tonnes of CO2 equivalent.
1 Scope 3 includes only Naspers and Prosus corporate.
2 Corporate offices include the Netherlands, Unites States, India, United Kingdom and Hong Kong offices.
LA Limited assurance obtained.
The full assurance report can be accessed on our website at:
www.naspers.com/investors/results-reports-events/latest-annual-report.
The carbon emissions data was prepared using criteria for scope 1, 2 and 3 emissions which may be accessed on our
website at:
www.naspers.com/investors/results-reports-events/latest-annual-report.
tCO2e*
135
0
135
21
0
0
0
51
tCO2e
6
16
31 437
31 459LA
500
67
22 389
22 956LA
6 929
3 848
10 777LA
422
2 134
2 556LA
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Sustainability review continued
Decarbonising our portfolio of companies
We will deliver on our portfolio coverage target by firstly
engaging our controlled portfolio companies, where we have
the highest level of influence and strong established
collaborative relationship. Our strategy is to guide and support
at least one controlled portfolio company per year to
complete the target-setting journey and submit it to SBTi for
verification. The anticipated impact of our multiyear
commitment is substantial; by FY30, we expect to help a group
of companies with an aggregate US$5.7bn in revenues,
advance on their net-zero pathway.
The development of a portfolio coverage target reflects our
evolving ‘portfolio view’, where climate actions are supported
at group level across our portfolio. This extends our
commitments well beyond majority-owned or controlled
companies to include listed and minority holdings.
The GHG emissions footprint of our portfolio of digital tech
companies is low relative to most industrial sectors.
Nonetheless, pockets of carbon-intense activities exist in some
of our segments’ value chains. Our businesses are exploring
scalable strategies to reduce emissions, for example in the
Food Delivery and Etail segments where all our companies
are implementing projects to extend the reach and use of
zero-emission electric vehicles in their delivery fleets.
We apply a three-step process to transition our portfolio to
align with a net-zero economy:
» We begin by mapping the environmental impact of a
company’s operations and extended value chain. Within
24 months of onboarding, each subsidiary is required to
calculate and disclose data for scope 1, 2 and 3 emissions
via our group carbon data reporting tool. This year, our
subsidiaries increased the quality and scope of their carbon
accounting. Most have now included material scope 3
categories in this process, essential for identifying
opportunities to decarbonise their businesses.
» Secondly, we help subsidiaries and associates employ
best practice and science-based frameworks to develop
net-zero pathways with multiyear targets. We have begun
a project of intense collaboration with iFood to develop
its science-based targets. The iFood team has started a
detailed analysis of SBTi guidance, and is scoping the GHG
footprint calculation for the company. iFood has already
made considerable progress on a method to measure GHG
emissions from packaging used by its restaurants. This
complex and resource-intense process is necessary for
setting the company on a net-zero pathway.
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» Thirdly, across our portfolio, we support the capital
expenditure and operating expenditure (capex and
opex) investments our businesses are making to ramp up
decarbonisation of their operations. For example, this year,
PayU invested in distributed renewable-energy credits to
fund the renewable-energy capacity of rural businesses
across India. In our Etail segment, substantial investments
have been made to accelerate the use of solar energy in
distribution centres and our food-delivery companies iFood
and Swiggy are scaling the electrification of delivery fleets.
Decoupling growth from emissions
iFood
iFood was carbon-neutral for FY23 and aims to use clean
transportation methods for 50% of its deliveries by 2025. In
the first quarter of the 2023 calendar year, 21% of its own
deliveries were made using non-polluting modes (bicycles,
e-bikes or e-motorcycles). To do so, it is developing solutions
that allow more deliveries to be carried out by bicycles and
creating financial products that encourage the use of
around 2 500 e-bikes in its iFood Pedal programme, which
has delivered 11 million orders since inception. For FY24,
the challenge will be to maintain the constant growth of
deliveries using traditional bicycles and e-bikes (iFood
Pedal) and to offer a robust programme for the sale or hire
of e-motorcycles for drivers.
By year-end, iFood had delivered 37 million zero-emissions
orders by bike, e-bike, e-motorcycles and drones.
OLX
OLX Group has focused on measuring its scope 1, 2 and
material scope 3 categories (purchased goods and
services and business travel). Seventeen employee-led
green teams have found ways to reduce the office
environmental footprint through recycling initiatives,
clean-ups, switching to green energy contracts and
investing in solar energy for OLX’s biggest warehouse in
Mexico. In total, over 30 initiatives were started globally
by employees, through a companywide hackathon.
OLX data privacy and tech teams have significantly
reduced its carbon footprint through data storage. By
following best practices in deleting unnecessary and old
image files in the OLX content management system, the
team saved more than 1 petabyte (1 000 terabytes) of
storage – reducing the level of server storage required
from a third-party provider.
In FY24, OLX will invest further in crystallising its ESG approach
to benefit all stakeholders: customers, communities,
employees, government regulators, and investors. It will
establish a preliminary path for reaching net-zero emissions,
using the SBTi framework, including an operational roadmap
for publicly disclosing targets by end-FY25.
PayU
The PayU business model supports the transition to a
lower-carbon financial services infrastructure. Despite a
relatively small carbon footprint, PayU measures and
manages carbon emissions in its operations and value
chain, and is defining a clear emissions-reduction pathway.
One example is its investment to purchase distributed
renewable-energy credits from renewable-energy projects in
rural India, thereby reducing its scope 2 emissions.
Over the past year, PayU matured its carbon-accounting
practices for scope 1 and 2, and continued to work on
completing an assurance readiness review on at least one
material scope 3 category. PayU’s highest priority is the
purchased goods and services category, with cloud and
data-related services being the main drivers.
In line with global good practice, it will set science-based
net-zero targets to be implemented and achieved over
three years and submit this to SBTi before the end of FY25.
eMAG
eMAG has rigorous carbon accounting already in place
for scope 1 and 2 emissions, and in FY23, eMAG
improved its scope 3 assessments for product-related
categories. For example, it calculates carbon intensity, a
measurement that defines carbon emissions relative to
the organisation’s turnover and number of employees.
By using its easybox network, eMAG reduces its direct
carbon footprint generated through fuel consumption
significantly (an easybox order generates up to 95% less
CO2 than one delivered to a customer’s home).
eMAG’s logistics centre in Romania is both state-of-the-art
and sustainable. It received an excellent rating under the
BREEAM standard for design and construction stages
certification programme, and the new warehouse under
construction in Hungary received the same rating for its
design stage.
The Romania warehouse is powered by green energy from a
rooftop photovoltaic panel grid. In FY23, further capacity was
added to this installation, totalling 2MW power via a network
of nearly 4 400 photovoltaic panels. eMAG has also instituted
a full green-energy contract for its other warehouses to
reduce carbon emissions from purchased electricity.
Takealot
Takealot is committed to environmental sustainability, both
in its operational practices and in the products offered.
The business strives to minimise its environmental footprint
by using certified sustainable materials and packaging
(and phasing out suppliers that do not comply), reducing
energy and water consumption, and creating ecofriendly
delivery practices. Takealot is maturing on its carbon-
accounting journey and conducted a readiness review for
material scope 3 categories. In the new year, it will define
the steps towards more comprehensive scope 3 disclosure
that will underpin long-term target setting.
In FY23, Takealot partnered with AEVERSA, a company that
aims to electrify South Africa’s commercial fleets. Since
November 2022, it is piloting a fully electric truck to
operate between its Johannesburg distribution centre and
proximity hubs. Based on an initial analysis, the electric
trucks also provide meaningful financial benefit, given
current fuel prices. Takealot will evaluate the pilot in FY24
and decide on further adoption of electric vehicles.
The e-bike programme for delivery drivers gained
momentum, with over 100 bikes on the road at year-end.
To protect drivers, new hires undergo extensive e-bike
safety training and travel is limited to daylight hours within
dedicated e-bike delivery zones. Customer response has
been overwhelmingly positive, and Takealot aims to
expand the programme to 500 e-bikes in FY24.
Edtech
In terms of environmental stewardship for our Edtech
segment, in FY23, Stack Overflow and GoodHabitz began
to inventory their carbon footprints by mapping scope 1, 2
and 3 emissions data. Given their online nature, these
businesses generate low levels of carbon emissions, while
they offer their customers less carbon-intense learning and
training, when compared to more traditional ways of
brick-and-mortar, offline schooling systems and education.
Engaging our supply chain to take climate action
In FY23, we began to engage with top suppliers of the
Naspers and Prosus corporate entities, requesting them to
share the GHG emissions related to services they provide to
our corporate headquarters operations and details of their
emissions reduction targets. We learnt that 82% of our top
suppliers have GHG reduction targets and 64% have science-
based reduction targets. We will continue this engagement
with all our suppliers, to better understand how to use
environmental metrics in future supplier selection. The primary
GHG data from our suppliers will deliver a reduction of
emissions from our procured goods and services and
education.
For information on the results of our supplier engagement,
refer to our environmental impact report.
Fair and just transition
The concept of a just transition emerged as a key pillar of the
global climate strategy at the 2022 COP27 climate summit.
This is particularly relevant given that a majority of our
businesses are located in the global south and often operate
in communities that are most vulnerable to climate change.
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Sustainability review continued
While countries of the industrialised north are overwhelmingly
responsible for climate change, impacts are felt most strongly
in parts of the world with limited resources to tackle the
problem. For example, a company seeking to decarbonise its
fleet of delivery vehicles in Germany benefits from lower costs
of capital and more enabling policies, incentives and
infrastructure than comparable businesses in Brazil, India or
South Africa.
This reality is core to any concept of climate justice – and
recognised in article 2.2 of the Paris Climate Agreement
by an explicit commitment to ‘the principle of common but
differentiated responsibilities and respective capabilities’.
Deploying available technologies to curb emissions is often
more difficult, disruptive and expensive in those economies
least responsible for global warming.
Climate goals are global, but operating environments and the
costs of transition are influenced by the available energy mix,
local economy, governments’ varying net-zero commitments,
policies and regulation. Each company’s operating country
context is critical to its decarbonisation pathway.
For example, Brazil has set a goal of achieving its net-zero
target by 2050. In contrast, India has set a date of 2070 to
achieve the same target. For example, our food-delivery
subsidiary iFood benefits more from Brazil’s enabling
ecosystem than its peer Swiggy in India or Mr D in
South Africa.
Materiality assessment of environmental impact
Our commitment to a fair and just transition underpins our
approach to creating sustainable value. Most of our
businesses operate in communities that are particularly
vulnerable to the impacts of climate change. We believe that
a commercial strategy anchored in the climate agenda will
contribute to reducing systemic risk, enhancing human capital,
and securing our societal licence to operate.
Our governance and management framework is in place,
ready to support all our businesses, operations and
subsidiaries and associates to meet global climate targets
aligned to the Paris Agreement goal of net-zero emissions.
Resource use
The business models of companies in our group are asset-
light, leading to a limited need for natural resources in their
value chains, beyond office space and equipment. There are
a few resource and carbon-intense activities in our Etail and
Food Delivery platforms. Curbing the environmental impact
of delivery services and packaging of food and goods is
a priority across our businesses in these segments.
Circular economy, packaging and biodiversity are focus
themes for our group. We take an active role in enabling
positive transitions and are committed to increasing our
understanding of mitigating measures and allocating capital
to solutions.
* Waste not from packaging use.
We also strive to create impact by supporting innovation.
Our Classifieds business enables resource optimisation by
promoting the recycling and reuse of goods. Additionally, our
Food Delivery and Etail portfolio companies are creating
opportunities to scale adoption of sustainable packaging, such
as reusable food containers or new biodegradable materials.
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Digital services reduce or eliminate dependence on physical
materials in delivery and consumption. For example, our
Payments and Fintech, and Edtech platforms enable online
education and digital payments, which require fewer materials
and consequently have lower impacts than their physical
counterparts. In online shopping, our investee Oda, a leading
online grocery-delivery company in the Nordic region,
commissioned a comparative study that showed online
grocery shopping can have a carbon footprint up to 60%
smaller than offline shopping.
Water use and waste generation are both of limited relevance
to the businesses of our controlled and non-controlled portfolio
companies. In our physical climate-related risk assessment
(refer to our TCFD report), we have looked at water risks
(flooding, drought, etc) with the potential to impact our
employees and supply chains. However, given that our
business models are online and minimally reliant on physical
assets and infrastructure, we have concluded that water stress
does not require a separate management programme as it is
not an important risk factor.
Sustainable packaging
The supply of high-quality packaging plays a critical role
in the success of food delivery and etail, not only for our
companies’ operations but also for their business partners.
Our food-delivery and etail subsidiaries are implementing
sustainable packaging strategies to reduce waste and
optimise resource use.
Food-delivery and etail platforms are powerful aggregators of
supply and demand for businesses and consumers. With their
scale and digital innovations, they can play an important role
in improving the sustainability of packaging by catalysing
innovation and rapidly scaling solutions.
In the absence of a global framework for sustainable
packaging, we have developed group principles and
approaches to help our portfolio companies develop effective
strategies. We have determined 10 golden rules to help
digital delivery platforms scale sustainable packaging across
their operations and value chains.
10 golden rules
for scaling sustainable packaging
Reduce
packaging
through design
and logistics
Create scale
through
collaboration
Remove
problematic and
unnecessary
elements
Invest in building
infrastructure
that captures
materials and
prevents waste
Raise awareness
to improve
recycling and
composting
9
8
Calculate
packaging
footprint
1
10
2
Golden rules for
delivery platforms
to scale sustainable
packaging
5
7
6
Promote
sustainable
options with
partners and
consumers
3
4
Reduce virgin
material and
increase recycled
content
Replace
petrochemical-
based plastics
with low-impact
and regenerative
materials
Adopt and scale
reuse models
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Sustainability review continued
In FY23, the packaging and waste working group, comprising all companies with a material packaging footprint, published two
impactful reports: the 10 golden rules for digital delivery platforms to scale sustainable packaging; and landscape studies on
packaging to identify solutions for new materials and strategies for reduction.
We will continue to map and optimise the material packaging footprint in our Food Delivery and Etail segments – finding ways to
do more with less.
iFood, the first food-tech company in Brazil to sign the
UN Global Compact, is using its presence in Brazil to
support the acceleration to greener economies. The
company estimates that Brazil produces over
11 million tons of disposable plastics annually,
including plates, cups, cutlery, plastic bags and
non-recyclable disposable straws. Without a national
or public-sector recycling plan for these items, they
end up in landfill or in the environment. Given its role
in the food ecosystem, iFood believes it can contribute
to improving Brazil’s waste management.
Last year, iFood committed to the #DeLivreDePlástico
initiative, driven by the United Nations Environment
Programme (UNEP), to eliminate plastic pollution from
deliveries off its platform by 2025. It has enabled the
‘no cutlery, straws, or napkins’ option in its app, and
encourages restaurants not to send these items
by default (only when requested). iFood has a
restaurant participation target of 90% by
December 2023, and aims to ship 80% of orders
without these disposable items by 2025.
iFood’s goal is to reduce plastics in deliveries by 50%,
with the remaining material being 100% recyclable by
2025. To better understand which deliveries and
meals cause the most packaging waste, iFood
leveraged its internal data, showing which meal types
are prime candidates for packaging reform. Based on
this data, it has focused on developing partnerships in
the paper industry, such as Suzano and Klabin, and
with start-ups producing sustainable packaging, such
as GrowPack, a biodegradable packaging factory
(using corn husk-based source material) to test this
packaging at scale. In addition, it has encouraged
large restaurant partners to go plastic-free. The
objective for FY24 is a launch of a portfolio of
affordable sustainable iFood packaging and
encouraging large restaurant partners to go plastic-
free.
eMAG is also improving its order-consolidation
process, combining multiple products for the same
client in a single package. The goal is to improve
its consolidation rate of 80% last year to 88% in FY24,
reducing packaging volume and shipping bulk.
Compared with FY22, eMAG reduced its packaging
consumption by over 20% and plastic packaging
by 35%, by eliminating or replacing with 100%
recyclable cardboard packaging.
Last year, South African subsidiaries, Takealot and
Media24, joined the SA Plastics Pact, confirming their
commitment to reduce impact from plastic packaging
and support the transition from a linear model of
take-make-waste to a circular economy for packaging.
To reduce waste, Takealot introduced recycling bins at
its pickup points in FY23, enabling customers to return
cardboard boxes for recycling. A second set of bins
allows customers to drop off used clothing that is then
supplied to the homeless.
In addition, Takealot will map its packaging
footprint by identifying and measuring volumes in the
extended value chain and determining what happens
with packaging after use. It will then create a
transition plan for sustainable packaging by applying
strategies of reduce, reuse, recycle/compost.
Circular economy
We live in a world of limited natural resources, where the mining of raw materials and manufacturing of products have negative
environmental impacts. The solution is to transition from a take-make-waste system to a circular economy.
A circular economy goes beyond simply recycling and enables consumers to live the lives they want, with limited environmental
impact. Extending a product’s life is a key part of the circular economy. By facilitating the trade of second-hand products, our
classifieds platforms extend life cycles for items that would otherwise have short life cycles. As a result, our need for new products
is lessened and our production of waste decreases.
108
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Biodiversity
Biodiversity risks and impacts are rapidly growing global
concerns. Biodiversity is a complex issue with multiple facets,
and businesses, investors, regulators and others are trying to
come to grips with the speed and scale of changes in our
natural world, from oceans to land and air.
We welcome the Taskforce on Nature-related Financial
Disclosures (TNFD) framework to guide our understanding of
the impacts of biodiversity loss, and to support our thinking
about how to reduce further negative impacts. We are
committed to mapping the full biodiversity impact of our
portfolio companies and developing effective mitigation
and adaptation measures.
Our initial assessment last year, based on business models
in our portfolio, indicated that biodiversity impact is minimal
compared to other business sectors. This is due to the digital
nature of our businesses and the fact that operations of our
portfolio companies mainly involve offices in urban areas with
supply chains comprising mostly service providers.
As we continue to assess our exposure, we will develop and
implement a no-deforestation commitment across our
businesses:
» We commit to prohibiting the clearing or converting of any
forest areas to develop new sites for our businesses.
» We are committed, where possible and feasible, to
procuring FSC (Forest Stewardship Council) paper and
cardboard products for all our Etail businesses and will
increase the share of FSC-certified products purchased.
In line with its commitment to sustainability and the objectives
of the Romanian environmental pledge, eMAG has partnered
with Foundation Conservation Carpathia (FCC). FCC created a
wilderness reserve in the Romanian Carpathian mountains by
purchasing land and hunting rights to protect the area from
deforestation and promote biodiversity. Its plan is to return the
land to the public domain and promote sustainable tourism in
the area. Forest conservation projects such as these play a
crucial role in combating global warming.
OLX
Our classifieds platform OLX has modelled the
positive impact of its circular model by calculating
how reusing consumer products, including
smartphones, televisions, laptops, and cars, leads to
substantial material savings and avoided GHG
emissions. The annual impact reports of OLX
quantifies this positive impact: it calculates the volume
of emissions that are avoided by enabling its
customers to extend the life of consumer goods like
televisions, phones, laptops, cars, motors and car
parts. For instance, in 2022 OLX helped, through the
trade of 26 million products, prevent the GHG
emissions of 5.2 million tonnes, equal to 31 million
trees that would need to be planted. The annual
impact report can be found on https://www.olxgroup.
com/impact. The power of digital platforms to
contribute exponentially to a low-impact society is
shown when we compare these avoided emissions to
the direct operational emissions of OLX and OLX
Autos, which were 40 000t CO2eq, or only 0.7% of this
total benefit.
eMAG – contributing to circular economy
eMAG’s Flip developed its in-house expertise to repair
any type of mobile phone, irrespective of apparent or
underlying defects. The environmental impact of a
refurbished phone is up to 80% lower than a new one.
Flip promotes the idea that refurbished phones are
a smarter acquisition for both customers and the
environment: consumers can save up to 40% on the
cost of a device that presents and functions like a
new one, benefit from a 12-month warranty and do
so all while making a positive impact on the
environment.
Similarly, eMAG’s Freshful grocery business has
incorporated sustainability principles into its operating
model since inception. For example, Freshful paper
bags are 100% recyclable, and the company offers to
recycle bags used in deliveries. In addition to
minimising food waste through efficient planning and
cold-chain management, Freshful’s ‘save me’
promotions enable customers to buy items close to
their expiry date. To date, this has prevented the
disposal of over 70 000 products. Next steps include
optimising order consolidations to further reduce the
use of paperbags, and plans to reduce, reuse, recycle
and compost packaging, while increasing the use of
sustainable packaging and reducing waste.
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109
Tax
Being a responsible global corporate citizen is at the core of
everything we do. We consider paying taxes as an important
economic contribution to the societies in which we operate, and
a normal consequence of doing business.
We support the establishment of a harmonised international
tax system where there is a level playing field and where all
players pay their taxes in the jurisdictions where they operate.
To understand our approach to paying taxes and interpret the
taxes paid information, it is important to understand our
operating model. As a global technology investor, our portfolio
of businesses is well diversified by sector and geography. We
operate on a decentralised basis in numerous countries. The
businesses are based in the countries where their operations,
users and consumers are. All our investees pay taxes locally,
in the jurisdictions where they operate and their products and
services are consumed. Overall, our aim is to improve the lives
of people who live in the countries where we operate –
paying taxes is an integral part of that aim and our business
operations.
Taxes paid in FY23
As a technology investor that backs local entrepreneurs, there
is typically no traditional value chain in which value is added
in multiple layers. Paying taxes in the markets where we
operate is important to contribute to those societies. This
ensures we provide a return to those communities and
countries for the benefit and privilege of doing business with
and in them.
Paying taxes locally is an extension of our commitment to
improving our customers’ lives through technology. Our
investees’ businesses directly improve people’s lives. Indirectly,
through taxes paid locally, people’s lives are further improved.
Locally paid taxes assist governments to fund the needs of the
populations in their countries.
In FY23, Naspers paid and collected US$1.2bn (FY22: US$1.4bn) in direct and indirect taxes globally. Details of taxes per country
are set out below:1
Corporate
income
and
withholding
taxes
Payroll taxes
and social
security
contributions
paid
Payroll taxes
and social
security
contributions
collected
VAT,
service
and
consumption
taxes
Other
indirect
taxes
123.3
132.8
24.8
Other
direct
taxes
8.0
2.4
0.9
Total
direct
taxes
100.6
70.6
91.5
66.8
1.9
35.4
51.5
20.8
47.7
25.8
0.4
0.8
0.0
16.1
18.2
285.4
14.9
6.5
2.8
4.0
10.9
59.8
52.4
67.8
11.5
22.5
0.9
–
123.3
(10.1)
1.1
42.3
30.7
57.7
5.4
0.7
1.8
59.7
0.0
2.0
5.0
0.0
3.0
1.7
55.8
93.5
59.7
66.3
23.1
1.7
23.4
110.9
48.0
3.1
23.2
–
9.6
26.9
1.9
24.8
370.5
66.2
820.1
408.3
2.3
3.2
6.2
11.8
0.9
2.5
31.2
97.9
Total
indirect
taxes
123.6
133.3
29.6
(10.1)
48.0
3.1
24.0
–
9.6
26.9
1.9
25.1
Total
tax
contribution
FY23
Total
tax
contribution
FY222
224.4
203.9
121.1
113.2
103.8
96.6
83.6
66.3
32.7
28.6
25.2
240.2
189.3
190.9
187.1
93.8
112.9
48.1
119.5
22.5
30.1
27.3
136.0
134.1
415.0
1 235.1
1 395.7
0.3
0.5
4.8
–
0.0
–
0.8
–
–
–
–
0.2
6.7
Region/Country
Brazil
Romania
South Africa
The Netherlands
Poland
Argentina
India
United States of America
Hungary
Bulgaria
Colombia
Other
Total
1 The table lists all the taxes paid on a country-by-country basis in the 11 jurisdictions with the largest tax contributions. These 11 jurisdictions contributed
approximately 89% of the total taxes paid in FY23. Taxes paid in 36 countries add up to the amounts under ‘Other’.
2 To have a direct comparison with the taxes paid in FY23, the taxes paid in FY22 exclude the taxes paid in countries where the operations have been discontinued.
Naspers shows a meaningful normalised effective tax rate of
26.8% for FY23 (FY22: 23.6%).
The group accounts for its share of results of its equity-
accounted investments net of taxation recognised by those
investments. To provide a more comparable and meaningful
effective tax rate, the tax recognised as part of the group’s
share of results from equity-accounted investments is included,
for purposes of calculating the normalised effective tax rate.
Compliance
As a family of essentially local businesses, the principles
we apply across our portfolio are consistent. We take tax
compliance seriously. Naspers has zero tolerance for non-
compliance with tax laws in all jurisdictions where our
businesses operate. This principle is embedded in the culture
of our group and is an element of the KPIs of finance and tax
teams.
Our tax team comprises experienced and effectively equipped
tax specialists. Regular training ensures all team members
maintain their optimal tax skill sets. Investees are accountable
for managing tax and adhering to our group tax policy,
including zero tolerance for non-compliance.
Compliance with laws and regulations in the countries where
we do business is essential to the integrity of our businesses
and all our actions. Ensuring we are compliant with tax
legislation in territories where we operate is non-negotiable.
We have to be – and we want to be – fully compliant: no
exceptions. This is how we do business and why our
stakeholders can have confidence in the integrity of our
actions.
Of course, we ensure we manage our tax costs, as with any
other business costs, as efficiently as possible. This is part of
our responsibility to our shareholders and our businesses. But
we do not abuse opportunities to unreasonably reduce the tax
cost of the business. All tax planning, whether driven by
acquisitions, rationalisations, disposals or disinvestments,
operational restructuring or legislative changes, is carried out
in line with our tax policy and our approach to tax. We will
take into account the intention and objective of tax legislation
or policy in how we apply the legislation. Our appetite for tax
risk is low. All tax planning is decided and effected in the
context of the business: tax consequences flow from business
operations. Business structures and operational models dictate
our tax strategy, not vice versa.
We do not engage with tax authorities to obtain special
dispensations. When obtaining advance tax rulings, we do this
via standard, transparent processes available to all taxpayers.
Our aim is to create certainty on the application and tax
consequences of business transactions. In line with our
commitment to tax transparency, we support making any
rulings publicly available.
Operating a decentralised local business model means that
transfer pricing is not the most significant factor in our tax
management. To the extent that it does apply, we ensure there
is always adherence to the arm’s length principle.
Naspers has grown organically and by acquisition. In the
course of these acquisitions, we inherited a number of legacy
structures, including some companies located in low-tax
jurisdictions. These structures are under constant review and
most have been eliminated. In FY22, four companies in low
or no-tax jurisdictions (two in British Virgin Islands, two in
Mauritius) were liquidated. In FY23, this was continued with the
liquidation of three entities: two in Mauritius and one British
Virgin Islands company. Additional legacy companies are
either being liquidated or identified for liquidation. Low or
no-tax jurisdictions are internally defined as countries with no
corporate income tax and countries listed on the EU blacklist
of non-co-operative jurisdictions for tax purposes. Presence in
such jurisdictions is retained only in cases where business
reasons dictate such a presence. We do not attempt to
engineer tax advantages by creating business entities in low
or no-tax jurisdictions in which Naspers does not operate or
have business substance.
Further guidance on how we manage taxes is publicly
available in our group tax policy.
Governance
We attach the highest priority to fairness, integrity and
transparency – in short, doing the right thing, no exceptions.
This approach is built on the following elements:
» Board accountability for tax through the group CFO and
audit and risk committees.
» A clear tax risk register and heatmap.
» A tax control framework with robust controls.
» Experienced tax professionals with the right skills.
» Training for and regular communication and engagement
between everyone with responsibility for tax.
» Using technology to automate tax processes.
Ultimate responsibility for tax vests with our group CFO who
is accountable to the Naspers board, with oversight from the
audit and risk committees. Our group tax policy is reviewed
annually by these committees, approved by the board and
published on our website.
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Integrated annual report 2023
111
Tax continued
Maintaining a risk register and heatmap assists us to follow a
structured approach to assess, prioritise, respond to, and
monitor potential high-impact tax risks. The risk register details
our top tax risks and how we manage each one. We use our
heatmap to rank our tax risks by impact and vulnerability and
track their movement over time. This guides our decision-
making, by focusing our activity on actions required to
effectively manage and mitigate tax risks.
The main tax risk for our business lies in legislative or
regulatory changes. This is especially true in our industry
where global tax developments (BEPS (base erosion and
profit shifting), pillar 1 and 2) and digital services taxes are
designed to apply to consumer internet and tech companies.
Monitoring legislative changes is a key priority, primarily to
ensure that our businesses are always compliant. In addition,
the impact of changes in regulations is timeously evaluated
via impact assessments. An example of this is the global
minimum tax rules of pillar 2. The tax impact of these rules is
expected to be fairly minimal based on how our business
operates: our local businesses pay their taxes locally, are
predominantly based in high-tax jurisdictions and permanent
book-to-tax differences are exceptional. Getting to grips with
the compliance elements of pillar 2 rules is one of our
priorities to ensure the group will be compliant once these
rules are enforced.
Besides monitoring (potential) changes in legislation, Naspers
also regularly contributes to (public) consultations. In our
engagements, we aim to contribute constructively and act
as a sparring partner, taking into account the objects and
purposes of legislative changes and their impact on our
decentralised business model.
Tax risks, tax challenges, interactions with revenue authorities
and other issues are under constant review and reported
regularly to our group CFO and the audit and risk committees.
We aspire to a ‘no surprises’ approach in managing taxes:
there should be no tax surprises at any level – whether in
relation to tax costs to a business, reporting to revenue
authorities or supplying relevant information to stakeholders.
Our tax control framework sets out the operational details for
managing tax risk in accordance with the criteria established
in our tax policy. We implement this framework consistently
across our controlled portfolio and operations, to ensure tax
compliance in all the jurisdictions where we operate. Our tax
control framework is also shared with relevant tax authorities.
All tax professionals are appropriately skilled for their role and
receive ongoing training. The tax team members are assisted
by reputable external advisers with specialist tax expertise
who provide input for all significant and many other tax
matters, advise on the tax consequences of transactions,
review tax filings and support the tax teams where necessary.
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The process for disclosing any improper conduct or concerns
of wrongdoing is outlined in the group’s speak up policy and
available to all on any matter, including tax behaviours.
Technology
Efficient tax management is enhanced by the use of
technology. Given the growing requirement by tax authorities
and other regulators to report substantive data, it is essential
to harness technology for data extraction, gathering and
collation. Technology is also paramount to eliminate any
human errors in collating relevant data and the tax compliance
process. Where possible, we have automated tax processes
such as the controlled foreign company compliance and
country-by-country reporting. Automation contributes to
enhanced data integrity and reduces the working hours
involved in these processes.
We will continue to expand the reach of automation and
technology in our tax management processes, where we are
confident of increased efficiency and integrity of information.
This focus is included in the KPIs of our tax team members.
At the same time, we recognise there are, and always will
be, many areas in tax that require ongoing attention and input
by skilled tax professionals. Where technology can be
implemented to enhance data collection and collation, and to
share relevant information with tax authorities, we believe a
reduction in working hours required for these tasks can enable
our group tax specialists to spend their time more effectively.
We will continue to invest time in assessing how technology
can assist in streamlining processes to effectively manage
our taxes and tax compliance.
Transparency
It is one of our KPIs to, at all times, constructively and
transparently engage with all our stakeholders, both external
and internal. These stakeholders include investors, customers,
employees, regulatory authorities, governments and policy-
makers, and tax authorities.
In 2022, the Dutch Confederation of Netherlands Industry and
Employers (VNO-NCW) published its Tax Governance Code.
Naspers, through Prosus, supports this code which provides for
tax principles aiming to improve transparency. Prosus also
endorsed the VNO-NCW Tax Governance Code, and our tax
principles are in line with those set out in the code. We
believe that our commitment to tax transparency and
associated governance principles are key to provide a better
public understanding of our rather unique approach to tax
and our tax contributions.
Disclosure of taxes paid is an important step in tax
transparency. We support this initiative to demystify and
reduce the stigma that may be attached to tax contributions
by companies, particularly multinationals. In our view,
disclosure demonstrates responsible corporate citizenship
and facilitates meaningful engagement with stakeholders in
the countries where we operate. Also public country-by-country
reporting is an important step in tax transparency. At the
same time, we recognise the risk that the information
disclosed under public country-by-country reporting and taxes
paid is interpreted wrongly or misunderstood. These rules do
not require providing any relevant context to the numbers
disclosed. Public data under the country-by-country rules
and the taxes paid only provides valuable information if there
is a deep understanding on the business activities in these
countries, including the life cycle of local business operations.
We regard tax authorities as significant stakeholders. As with
all other stakeholders, it is important for us and our investee
companies to engage proactively and transparently with tax
authorities. Our approach, where possible, is to follow the
principle of co-operative compliance. We engage regularly
with tax authorities to explain our business model and
proactively share information with them. While recognising that
at times our views and those of the tax authorities may differ
in applying specific tax rules and legislation, we aspire to a
relationship of mutual trust. This sometimes creates dilemmas.
But our aim remains for stakeholders, including revenue
authorities, to have confidence in the integrity of our actions,
the way we do business and the information we provide. As
such, we will continue to take proactive steps to enhance the
scope of tax information relevant to our stakeholders.
Naspers is an active supporter and contributor of the
Capabuild project; a public-private partnership co-building tax
capacity for developing countries by way of tax training for tax
authorities, policy-makers and other government officials in the
global south. Capabuild strives to improve the understanding
of global taxation as this can help governments improve the
effectiveness and efficiency of the tax system in their
jurisdiction. As taxation is a significant factor in every nation
and every citizen’s life, it is important that it is understood.
It needs to be demystified. Through our contribution to the
training platforms offered by Capabuild, we are able to
share our knowledge and emphasise the need for dialogue,
building trust and true transparency on taxes paid, collected
and applied to improve the lives of citizens, those people
the governments serve. We proudly support initiatives such as
those of Capabuild. These contribute to having sustainable,
fair and transparent tax systems that enable governments to
provide for their citizens.
Regulatory risk
Managing tax efficiently means effectively managing risk.
This important area is another KPI for our tax teams. As we
operate in many jurisdictions, tax policy and legislative
changes are an ongoing risk. We need to be aware of
impending policy or legislative changes and be ready to
implement these when they arise. But this also means that
we need to constructively engage with policy-makers and
legislators to ensure our messages are heard when policies
or legislation are changed. Our reputation as a responsible
corporate citizen contributes to us being heard by these
bodies. Where we are able to build relationships of trust,
we do so. We believe this gives us credibility and will further
enhance our reputation as a taxpayer with integrity.
Naspers continues to provide constructive and reliable
feedback to tax policy-makers and other stakeholders through
submissions to public consultations or direct engagement
at national and international levels.
Level playing field
As a global investor, we subscribe to certain tax policy
fundamentals: we believe it is in everyone’s best interests to
establish a level playing field in which local, regional and
global companies are subject to the same taxes in the
countries where they operate.
In our view, taxes should be fair, balanced and uniform.
To create the level playing field, we believe that taxation
of profits and local tax systems should be governed by
a harmonised international framework. We actively support
international initiatives led by the OECD/G20 inclusive
framework on base erosion and profit shifting to develop a
global policy to modernise and remove imbalances from the
international tax system. These align with our approach to
taxes and where we believe taxes should be paid.
The level playing field will ensure that each business is subject
to the same taxes, irrespective of whether it operates globally,
regionally or locally. We engage in discussions where we
believe we can contribute to ensuring this harmonised global
tax system with a level tax playing field is created.
Certainty, transparency, fairness, integrity and doing the right
thing, no exception – these are fundamentals in our approach
to tax management at Naspers. We want to ensure that,
at all times and in all jurisdictions, we pay the correct and
appropriate amount of tax, commensurate with the business
operations in that geography, and that we can openly
demonstrate this to our stakeholders.
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Integrated annual report 2023
113
Brazil
114
NASPERS
Integrated annual report 2023
Highlights
2021
Smartphone users
173 million
81%* of population
is internet users
2022
Population
218.7 million
Unemployment rate
7.9%
GDP
2.9%
Inflation
7.8%*
2023
Food Delivery
750 million orders
2026*
Online grocery sector
20% CAGR*
Smartphone penetration
85%
* Estimated.
Naspers offers
» Building a global leader in on-demand
food delivery.
» iFood is the most-loved delivery company
in Brazil, engaging with society through
meaningful actions.
» Around 1 500 Brazilian cities covered.
» Financial service offering gained traction.
» Innovation driving growth for iFood.
» ESG:
• For 2025: We aim for no plastic
pollution in iFood’s food deliveries;
to remain carbon-neutral; and to
have non-polluting delivery methods
for 50% of deliveries.
• Todos a Mesa (all at the table)
programme aims to end food
insecurity (15% of the population faces
this issue). Besides food donations,
iFood users can donate money through
its app – iFood is now the largest
donation platform in Brazil, with over
BRL25m donated since 2021.
• 5 000 people have completed iFood’s
basic education courses for its driver
community. For FY24, iFood aims to
have 30 000 drivers complete the
basic education programme.
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Integrated annual report 2023
115
Governance
Group structure
Introduction
Established in 1915, Naspers has transformed into a global
consumer internet company and one of the largest technology
investors in the world. Through Prosus, the group operates and
invests globally in markets with long-term growth potential,
building leading consumer internet companies that empower
people and enrich communities. Prosus has its primary listing
on Euronext Amsterdam and a secondary listing on the JSE
Limited (JSE), Johannesburg’s stock exchange, and A2X
Markets in South Africa. Naspers is the majority owner
of Prosus.
In South Africa, Naspers is one of the foremost investors in
the technology sector and is committed to building its internet
and ecommerce companies in the country. These include
Takealot.com, Mr D Food, Superbalist, AutoTrader, Property24
and PayU, in addition to Media24, South Africa’s leading print
and digital media business.
Listing and regulatory environment
Naspers has its primary listing on the JSE’s stock exchange
(NPN.SJ) and a secondary listing on A2X Markets (NPN.AJ)
in South Africa. It is the largest South African company on the
JSE. It also has a level 1 American Depository Receipt (ADR)
programme which trades on an over-the-counter (OTC) basis
in the US. Investors are therefore able to buy and sell Naspers
securities on several markets. Naspers’ subsidiary, Prosus N.V.
(Prosus), is listed on Euronext Amsterdam with secondary
listings on the JSE Limited’s stock exchange (XJSE:PRX) and
A2X Markets (PRX.AJ). It also has bonds listed on Euronext
Dublin, and ADRs that trade on an OTC basis in the US.
Right to hold and transfer shares
Naspers’ memorandum of incorporation places no limitations
on the right to hold or transfer N ordinary shares (listed).
There are no limitations on the right to hold or exercise voting
rights on these shares imposed by South African law.
Naspers voting control structure
The aim of the Naspers voting control structure is to ensure the
continued independence of the group. When entering foreign
countries in the broad media or communications spheres, and
when dealing with regulators, it is critical that we give an
assurance of our continuity of identity: in other words, that we
will not, after we have entered a territory or secured a licence,
be taken over by unknown entities with whom the country
or regulator may be uncomfortable. We believe that this
assurance of independence and continuity is critical for
our entry into, and operation in, many markets.
116
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Integrated annual report 2023
International
Differentiated voting rights and control structures are
commonly used in the media and internet sectors to secure
independence and deter raids or efforts to seize control.
Many international media and technology companies have
differentiated rights or control structures. Some more well-
known examples include: Schibsted and Tele2 in Norway;
MTG in Sweden; Daily Mail and General Trust in the UK;
JD.com and Alibaba in China; and Alphabet (Google), Meta,
LinkedIn, 21st Century Fox, News Corporation, Discovery,
Liberty Global, Snap Inc., Zillow and Zynga in the US.
In recent times, many internet and tech companies in
particular have implemented similar structures.
Structure
The issued share capital of Naspers comprises two classes
of shares:
» N class ordinary shares that have one vote per share
and are listed on the JSE. As at 31 March 2023, there are
435 511 058 N ordinary shares in issue.
» Unlisted A class ordinary shares that have 1 000 votes per
share, but have relatively insignificant economic
participation (the dividends declared to A ordinary
shareholders are equal to one fifth of the dividends per
share to which N ordinary shareholders are entitled). As at
31 March 2023, there are 961 193 A shares in issue.
A majority of A class ordinary shares are held by two
companies that together comprise the control structure
of Naspers.
Keeromstraat 30 Beleggings (RF) Limited (Keerom) and
Naspers Beleggings (RF) Limited (Nasbel) hold such A class
ordinary shares that together they control more than 50%
(currently 55%) of the voting rights in Naspers. These two
companies exercise such rights in consultation with one
another. No other entities are part of the control structure.
Keerom has 2 821 shareholders as at 31 March 2023 and
its constitutional documents provide that no shareholder
is entitled to exercise more than 50 votes regardless of
shareholding which represents 0.39% control.
Nasbel has 2 588 shareholders as at 31 March 2023,
one of which is Heemstede Beleggings Proprietary Limited
(Heemstede) (a wholly owned subsidiary of Naspers) that
holds 49% of the shares in Nasbel.
The boards of directors of Keerom and Nasbel operate
independently.
Cross-holding agreement
Naspers and Prosus entered into a cross-holding agreement
to regulate their relationship following Prosus’ acquisition of
around 52.46% economic interest in Naspers’ listed shares
to give shareholders certainty that the full extent of Prosus’
free-float shareholders’ effective economic interest in the
underlying Prosus portfolio in distributions will be paid directly
and efficiently at the Prosus level.
In terms of this cross-holding agreement, Prosus’ free-float
shareholders’ effective economic interest in the underlying
Prosus portfolio (the Prosus free-float’s effective economic
interest) is 56.43% (larger than the 35.64% Prosus free-float
direct holding of Prosus ordinary shares N). Naspers’ free-float
shareholders’ effective economic interest in the underlying
Prosus portfolio (the Naspers free-float’s effective economic
interest) is 43.54%.
To ensure effective and ongoing interaction between Prosus
and Naspers, distributions are made on a ‘terminal economic
value’ basis. This gives shareholders certainty that the full
extent of the Prosus free-float’s effective economic interest in
distributions is paid directly and efficiently at the Prosus level.
The term ‘terminal economic value’ refers to a terminal
(ie effective) economic value distribution that requires that
both Naspers and Prosus’ free-float shareholders receive
distributions based on their ultimate underlying interests in
the group as if a distribution had been made continuously
a number of times through the crossholding.
A terminal economic value distribution requires that both
Naspers and Prosus’ free-float shareholders receive their
ultimate underlying interests. This means Naspers will
automatically distribute any distribution it receives from
Prosus under the cross-holding agreement to its free-float
shareholders and Prosus waives in advance any entitlement
to the onward distribution declared by Naspers.
Shareholding structure
0.07%
(0.01%)
0.04%
(0.01%)
0.03%
(0.01%)
Naspers
Beleggings (RF)
Limited
0.39%
6.11%
Keeromstraat
30 Beleggings
(RF) Limited
Free float of
unlisted shares
Free float of
listed shares
33.82%
(0.02%)
49%
Heemstede
Beleggings
Proprietary
Limited
21.20%
(0.01%)
13.80%
(0.01%)
14.32%
(47.49%)
100%
Naspers
Limited1
75.92%2
(43.54%)
15.81%
(52.46%)
Prosus N.V.
Free float of
listed shares
23.94%
(56.43%)
1 Economic interest shown in brackets where different from voting interest. Voting interest
calculated in accordance with the South African Companies Act, 2008.
2 This includes the ordinary shares B held by Naspers.
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117
Overview of governance
Governance structure
The governance structures of Naspers and Prosus substantially
mirror each other. Naspers and Prosus have an identical
one-tier board structure of executive and non-executive
directors. Executive directors are responsible for the group’s
day-to-day management, which includes formulating its
strategies and policies and setting and achieving its
objectives. Non-executive directors supervise and advise
executive directors. Each director has a duty to the company
to properly perform their assigned responsibilities and to act
in its corporate interest.
The audit and risk committees of the board monitor
compliance with the JSE and Euronext Dublin requirements
applicable to the Prosus bonds listed on that exchange.
The board’s projects, audit, risk, human resources and
remuneration, nominations, and social, ethics and
sustainability committees fulfil key roles in ensuring good
corporate governance.
The group uses independent external advisers to monitor
regulatory developments, locally and internationally, to enable
management to make recommendations to the board on
matters of corporate governance.
How we integrate governance into our business
We recognise the value of an integrated approach to
assurance and compliance. The adopted governance, risk
and compliance framework is the basis for how we
manage governance.
This framework illustrates how we achieve a sustainable
business integrated with governance, assurance, risk
management and compliance, in line with legislated
requirements and King IV recommendations and reported
through the relevant structures.
Our subsidiaries, associates and investees are required to
comply with applicable laws and regulations. A risk-based
legal compliance programme (including anti-bribery and
anti-corruption) has been implemented as per this framework
in all subsidiaries.
In applying our capital allocation strategy, we look very
carefully at risks relating to the countries and sectors in which
we invest. We review potential investees and their founders
and/or major shareholders; it is important for us to know with
whom we are doing business. Our traditional due diligence
looks at the commercial and financial position of the
investees, but also covers legal (including IP, privacy
and litigation) and tax aspects of their business. This is
supplemented by contact between our team and the
founder(s) and their management teams to understand the
culture of the investees. More recently, for acquisitions of
majority-ownership stakes in larger businesses, we formally
assess the investee’s ethics and legal compliance framework
and HR policies against our own framework and policies to
see what actions (if any) will need to be taken for the investee
to meet our minimum requirements. The governance
frameworks of investees differ depending on their scale and
maturity: some are simply too small or early-stage to have a
fully built and mature governance and compliance framework.
In each case, however, we believe that our contact with the
founders and management teams and our additional due
diligence help us to understand the purpose and culture of
each company. For a discussion of our approach to
responsible investments, please see page 77.
Our largest investees, many of which are of significant size,
have adopted their own appropriate governance standards.
A number of these companies have listings on leading stock
exchanges and therefore need to comply with both local law
and the requirements of the relevant exchange and this is
reflected in the standards that they adopt. If members of our
team serve on the boards of investees, they are sometimes
able to help shape the investee’s governance standards. They
do this by sharing the governance standards that we have
adopted on relevant topics, offering support to associates
through training or workshops, and generally sharing our
knowledge and expertise. Periodically, teams of the company
and associates meet to discuss governance standards and
share their experiences.
Group governance framework
The board is the focal point for, and custodian of, the group’s
corporate governance systems.
It conducts the group’s business with integrity and applies
appropriate corporate governance policies and practices in
the group.
The board, its committees, and the boards and committees
of subsidiaries, are responsible for ensuring the appropriate
principles and practices of King IV are applied and
embedded in the governance practices of group companies.
A disciplined reporting structure ensures the board is fully
apprised of subsidiary activities, risks and opportunities.
All subsidiaries in the group are required to subscribe to the
principles of King IV. Business and governance structures have
clear approval frameworks.
The group’s governance committee comprises the segment
chief financial officers, chief financial officers of Naspers
and Prosus, Takealot.com and Media24, as well as the group
company secretary and global head of governance, group
general counsel, group head of risk and audit, global head
of sustainability and global ethics and compliance lead. The
committee was tasked to ensure the group’s governance
structures and framework are employed across the
consolidated entities in the group during the financial year.
Governance and progress are monitored by the audit and
risk committees and reported to the board.
As the companies in our group are diverse and at different
maturity stages, a one-size-fits-all approach cannot be
followed in implementing governance practices. All good
governance principles apply to all types and sizes of
companies, but the practices implemented by different
companies to achieve the principles may be different.
Practices must be implemented as appropriate for each
company, in line with the overarching good governance
principles.
Details of choosing the right opportunities and balancing risks
(including principal risks) appear on pages 40 to 43. The
board’s responsibility statement on risk management is on
page 173.
Our approach to applying King IV and
statement by the board
Naspers is required, in terms of the JSE Listings Requirements,
to report its application of the principles of King IV. In line with
the overriding principle in King IV of ‘apply and explain’, the
board, to the best of its knowledge, believes the group has
satisfactorily applied the principles of King IV. For a more
detailed review of Naspers’ application of King IV, refer
to the King IV application report 2023.
All board and board committee charters and policies
are aligned with the South African Companies Act, 2008
(Companies Act) requirements, the principles in King IV and
the JSE Listings Requirements. King IV advocates a qualitative
approach to implementing recommended practices to realise
the intended governance outcomes.
In line with King IV recommendations, we consider
proportionality when we apply corporate governance in
the group. This means we apply the practices needed to
demonstrate the group’s governance in terms of King IV
as appropriate across the group.
Long-term value creation and strategy
The board ensures that a culture of business ethics and
conduct aimed at long-term value creation is promoted to
underpin the group’s activities as a responsible corporate
citizen. This includes adopting values and a code, leading by
example, and monitoring implementation to make the required
disclosures on incorporation, compliance and effectiveness. In
this regard, the board is responsible for group performance
by steering and providing strategic direction to the company,
taking responsibility for adopting a view on long-term value
creation and aligned strategy and plans (which originate
from management). The board must approve the annual
business plan and budget compiled by management, for
implementation by management, taking cognisance of
sustainability aspects in long-term planning.
For more information on the group’s strategic approach,
please refer to page 32.
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Overview of governance continued
Internal controls, risk and audit
Risk and audit
Internal control systems
Our system of internal controls aims to prevent or detect
material risks and to mitigate material adverse consequences.
The system provides reasonable assurance on achieving
company objectives. This includes the integrity and reliability
of the financial statements; safeguarding and maintaining
accountability of its assets; and to detect fraud, potential
liability, loss and material misstatements while complying
with regulations. The directors representing Naspers on
boards of entities where it does not have a controlling
interest, seek assurance that significant risks are managed
and systems of internal control are effective.
Management, with assistance from risk and audit, regularly
reviews risks and the design and operating effectiveness of
internal controls, seeking opportunities for improvement. The
external auditor considers elements of the internal controls
system and communicates deficiencies when identified.
The board reviewed the effectiveness of controls on key risks
for the year ended 31 March 2023. This assurance was
obtained principally through a process of management
self-assessment, including formal confirmation via
representation letters by executive management.
Consideration was also given to other input, including reports
from risk and audit, compliance and the risk management
process. Where necessary, programmes for corrective actions
have been initiated and progress is monitored.
While we work on continuously improving our processes on
financial reporting, no major failings have occurred to the
knowledge of the directors and therefore the directors are of
the opinion that these systems provide reasonable assurance
that financial reporting does not contain material inaccuracies.
A central risk and audit function for the group provides
independent, objective assurance and risk support services
to the system of risk management and internal control to help
management preserve and create sustainable value. The head
of risk and audit reports to the chair of the audit committee,
with administrative reporting to the chief financial officer.
The function’s core competency lies in risk-based technology
and business process assurance work. Through its specialised
cybersecurity team, risk and audit also supports our
businesses to continuously enhance their technology and
cyber-capabilities to ensure resilient and secure platforms in
the face of evolving cyber-risks.
The risk and audit function operates in conformance with the
International Professional Practice Framework of the Institute of
Internal Auditors and, in line with these, submits itself regularly
to an external quality review.
Among other aspects, risk and audit is responsible for
providing a statement annually on the effectiveness of the
group’s governance, risk management and control processes
to the board of directors and, to the audit committee
specifically, of the results of its review of financial controls.
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 the 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 it provides
a service where it:
» functions in the role of management of the company, or
» audits its own work, or
» provides services that are prohibited under applicable
independence standards, or
» serves in an advocacy role for the company.
Relations with shareholders and investors
Investor relations
Naspers’ investor relations policy (refer to our website at
www.naspers.com) 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 in our non-financial (or
sustainability) performance. 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 full-year results.
A range of public communication channels (including stock
exchange news services, corporate websites, press agencies,
news wires 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 to
provide forward-looking information. Naspers also 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 releasing 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
or recommendations on 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 appears in this integrated
annual report, where shareholders have the opportunity to
put questions to the board, management and chairs of
the various committees.
The company’s website provides the latest and historical
financial and other information, including financial reports.
Annual general meeting
Naspers held its 108th annual general meeting in August
2022. Shareholders were encouraged to attend this meeting
and to ask questions at or in advance of the meeting.
In 2023, Naspers will again hold an annual general meeting.
The external auditor is welcomed to this meeting and is
entitled to address the audience. As questions asked at the
Naspers annual general meeting tend to focus on business-
related matters, governance and the remit of board
committees, the chief executive, chief financial officer and
chairs of our board committees attend this meeting.
The annual general meeting for Naspers will be held in
accordance with the notice of virtual annual general meeting.
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The board and its committees
Attendance at meetings
Directors1
JP Bekker
B van Dijk
V Sgourdos
S Dubey2
HJ du Toit
CL Enenstein
M Girotra
RCC Jafta
AGZ Kemna
FLN Letele
D Meyer
R Oliveira de Lima
SJZ Pacak
MR Sorour
JDT Stofberg
BJ van der Ross3
Y Xu
MI Davidson
5 (100%)
5 (100%)
5 (100%)
5 (100%)
5 (100%)
5 (100%)
5 (100%)
4 (80%)
5 (100%)
5 (100%)
5 (100%)
5 (100%)
5 (100%)
5 (100%)
6 (100%)
6 (100%)
6 (100%)
5 (83%)
6 (100%)
6 (100%)
6 (100%)
6 (100%)
5 (83%)
6 (100%)
6 (100%)
5 (83%)
6 (100%)
6 (100%)
–
5 (100%)
6 (100%)
Board
(fixed)
Board
(ad hoc
meetings)
5 (100%)*
6 (100%)*
Audit
committee
Risk
committee
Social, ethics
and
sustainability
committee
Nominations
committee
Human resources
and remuneration
committee
3 (100%)
4 (100%)
3 (100%)
3 (100%)
2 (100%)
2 (100%)
1 (100%)
2 (67%)
3 (100%)
3 (100%)*
3 (100%)*
3 (100%)
3 (100%)
2 (100%)
3 (100%)*
0 (0%)4
2 (100%)*
2 (100%)
2 (100%)
83%
2 (67%)
4 (100%)
93%
100%
Total meeting participation
99%
97%
92%
100%
* Chair
1 The projects committee did not hold any meetings in FY23.
2 Appointed as a director from 1 April 2022 and to the audit committee from 1 October 2022.
3 Retired as a director from 1 April 2022.
4 Unable to attend meetings due to long-standing commitments and urgent family matters. However, Mr Letele provided input on matters to be addressed ahead of
the meeting.
56%
independence of
the board
98%
board meeting
attendance
Naspers: Broad-based black economic empowerment (BBBEE) generic scorecard1
Element
Equity ownership
Management control
Employment equity
Skills development
Preferential procurement
Enterprise and supplier development
Socioeconomic development
Total score
Performance (%)
BBBEE rating
Priority elements achieved
Target
score
Bonus
points
available
Bonus
points
achieved
25
9
10
20
27
15
5
111
5
2
2
9
Score achieved
FY23
20
2.25
4.39
15.88 (includes the 0.24 bonus points)
16.36 (includes the 2 bonus points)
17 (includes the 2 bonus points)
5
0.26
2
2
4.24
80.88 (includes the total 4.24 bonus points)
72.86%
Level 4
Yes
1 BBBEE is a form of economic empowerment legislated in South Africa.
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3 (100%)
3 (100%)
4 (100%)*
81
44
Racial diversity (%)
Gender diversity
19
37
●
●
Black people
Other
●
●
Local
International
14
12
10
8
6
4
2
0
12
11
10
5
6
6
2021
2022
2023
●
Female
●
Male
Country of residence
Tenure as a director
1
1
1
2
2
9
●
●
South African
Dutch
●
●
American
Brazilian
●
●
Indian
Chinese
10
8
6
4
2
0
10
3
1
Up to
two years
Three to
four years
0
Five to
six years
Seven to
nine years
More than
nine years
2
Director classification (%)
6
13
56
25
●
Chair
●
Executive director
●
●
Non-independent
non-executive director
Independent
non-executive director
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The board and its committees continued
Composition
Details of directors at 31 March 2023 are set out on
pages 14 and 15.
Naspers has a unitary board, which provides oversight
and control. The board charter sets out the division
of responsibilities.
The majority of board members are independent non-
executive directors and are independent of management.
To ensure that no one individual has unfettered powers of
decision-making and authority, the roles of chair and
chief executive are separate.
The independence of each director was evaluated. The board
determined that although some directors had served as
members for nine years or longer, they all demonstrated they
were independent in character and judgement, and there
were no relationships or circumstances that were likely to
affect or could appear to affect their independence.
The board diversity policy addresses the requirements in the
JSE Listings Requirements for all listed companies to have a
policy on how they address gender and race diversity at
board level. The board is satisfied that its composition reflects
the appropriate mix of knowledge, skills, experience, diversity
and independence.
As set out in the board diversity policy, the board aims to
achieve a one third female (and male) representation. Over
the past three years, all new appointments to the board have
been women. Subsequent to year-end, at the time of writing
this report, one third of non-executive directors are women.
This demonstrates the board’s ongoing commitment
to transformation in line with its board diversity policy.
The group recognises and embraces the benefits of having
a diverse board and sees diversity at board level as an
essential element in maintaining a competitive advantage.
A diverse board will include and make good use of
differences in the skills, geographical and industry
experience, background, race, gender, and other
distinctions between its members.
These differences will be considered in determining the
optimum composition of the board and, when possible,
will be balanced appropriately. All board appointments are
made on merit, in the context of skills, experience, diversity,
independence and knowledge, that the board as a whole
requires to be effective.
The nominations committee reviews and assesses board
composition on behalf of the board and recommends the
appointment of new directors. This committee also oversees
the annual review of board effectiveness.
Roles and responsibilities
The board
The board is responsible for the continuity of the company and
its affiliated enterprises. The board focuses on long-term value
creation of the company and subsidiaries, and considers the
stakeholder interests that are relevant in this context.
The board serves as the focal point and custodian of
corporate governance and is responsible for the corporate
governance of the company, including: determining what
business we are building, what we offer users and key
objectives; and ensuring and monitoring that a culture of
business ethics and conduct aimed at long-term value creation
is promoted to underpin the group’s activities as a responsible
corporate citizen. This includes adopting values and a code,
leading by example, and monitoring implementation to make
the required disclosures on incorporation, compliance and
effectiveness.
The board acknowledges that the group’s core purpose, its
risks and opportunities, strategy, business model, performance
and sustainable development are all inseparable elements
of the value-creation process. In this regard, the board is
responsible for group performance by steering and providing
strategic direction to the company and ongoing oversight of
the implementation of the strategy and business plan.
A charter setting out the board’s responsibilities can be
found on our website at www.naspers.com/about/policies.
The chair
Lead independent director
The chair, Koos Bekker, is a non-executive director. The
responsibilities of the chair are set out in the board charter
and include:
Hendrik du Toit was appointed to act as lead independent
director in all matters where there may be an actual or
perceived conflict.
» Providing overall leadership to the board without limiting the
principle of collective responsibility for board decisions,
while being aware of individual duties of board members.
» Ensuring a culture of openness and accountability within
the board.
» In conjunction with the chief executive, representing
the board in communicating with shareholders, other
stakeholders and, indirectly, the public.
» Monitoring how the board works together and how
individual directors perform and interact at meetings.
The chair meets with directors annually to evaluate their
performance.
The chief executive
The chief executive reports to the board and is responsible
for the day-to-day business of the group and implementing
policies and strategies approved by the board. Chief
executive officers of the various businesses assist him in this
task. Board authority conferred on management is delegated
through the chief executive, against approved authority levels.
The board is satisfied that the delegation-of-authority
framework contributes to role clarity and the effective exercise
of authority and responsibilities.
Bob van Dijk is the appointed chief executive. He has no other
professional commitments outside the group.
Succession planning for the chief executive is considered
annually.
The functions and responsibilities of the chief executive are set
out in the board charter and include:
» Developing the company’s strategy for consideration,
determination and approval by the board.
» Developing and recommending to the board yearly
business plans and budgets that support the company’s
long-term strategy.
» Monitoring and reporting to the board on the performance
of the company.
The responsibilities of the lead independent director are set
out in the board charter and include:
» Dealing with shareholders’ concerns that contact through
normal channels has failed to resolve, or where such
contact is inappropriate.
» Strengthening independence of the board if the chair is not
an independent non-executive member.
» Chairing discussions and decision-making by the board on
matters where the chair has a conflict of interest.
Independent advice
Individual directors may, after consulting with the chair or
chief executive, seek independent professional advice, at the
expense of the company, on any matter connected with
discharging their responsibilities as directors.
Company secretary
The group company secretary, Lynelle Bagwandeen, 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 persons noted above whose functions and responsibilities
include (as appropriate):
» Playing a pivotal role in the company’s corporate
governance and ensuring that, in line with pertinent laws,
the proceedings and affairs of the board, the company and,
where appropriate, shareholders are properly administered.
» Acting as the company’s compliance officer as defined in the
Companies Act and as the delegated information officer.
» Monitoring directors’ dealings in securities and ensuring
adherence to closed periods.
» Attending all board and committee meetings.
The performance and independence of the company
secretary are evaluated annually.
As required by JSE Listings Requirement 3.84(h), the board has
determined that the company secretary, an admitted attorney
with over 10 years of JSE-listed-company 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 arrangements for providing corporate governance
services are effective.
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The board and its committees continued
Board meetings and attendance
Board committees
Social, ethics and sustainability committee
Evaluation
The board meets at least four times per year or more as
required.
The projects committee attends to matters that cannot wait for
the next scheduled meeting. Non-executive directors meet at
least once annually without the chief executive, chief financial
officer and chair present, to discuss the performance of these
individuals.
The company secretary acts as secretary to the board and its
committees and attends all meetings.
Indemnification
While the whole board remains accountable for the
performance and affairs of the company, it delegates certain
functions to committees and management to assist in
discharging its duties.
Appropriate structures for those delegations are in place,
accompanied by monitoring and reporting systems to ensure
integrated thinking. As contemplated in the memorandum of
incorporation and our insurance programme, indemnities have
been issued by Naspers to its directors.
Key focus areas for the year
Through advice and supervision of management, the non-
executive members of the board ensure that a culture of
strong business ethics and conduct aimed at long-term value
creation is promoted to underpin the group’s activities as a
responsible corporate citizen (see the sustainability review on
page 76).
Focus areas for the board in FY23 included enhancing reporting
to our board committees and board on how we implement good
corporate governance in the group in light of King IV. We have
also focused on improved disclosures in the annual report.
Governance of information and technology, particularly data
privacy and cybersecurity, remained focus areas along with
sustainability.
We updated and enhanced multiple key group policies, including
the sanctions and export controls policy.
The board has constituted six committees from among the
directors to assist in discharging its duties: audit; risk; social,
ethics and sustainability; nominations; human resources and
remuneration; and projects.
Each committee acts within agreed, written terms of reference.
The chair of each committee reports at each scheduled
board meeting.
The chairs of all committees (except projects) are non-
executive directors and required to attend annual general
meetings to answer questions.
The established board committees in operation during the
financial year are set out below and the names of members
in office during the financial year, as well as details of
committee meetings attended by each member, appear in the
table on page 122.
Audit committee
The audit committee seeks to support the board in assessing
the integrity of the group’s financial reporting and by
providing constructive challenges and oversight of the group’s
activities and of its audit functions. It comprises a majority
of independent non-executive directors and is chaired by
Steve Pacak, a non-executive director. The board considers
Steve to be independent of mind and judgement in his
conduct as chair of the committee.
Risk committee
The purpose of the risk committee is to assist the board
to discharge its responsibilities for the governance of risk
through formal processes, including an enterprise-wide risk
management process and system. The committee comprises
two independent non-executive directors, as well as the chief
executive and chief financial officer and is chaired by Steve
Pacak, a non-executive director.
The nominations committee carries out the evaluation process,
which is not externally facilitated, annually.
As part of the review, the performance of the board and its
committees, as well as the performance of the chair of the
board, is considered against their respective mandates in the
board charter and charters of its committees. The committees
perform self-evaluations against their charters for
consideration by the nominations committee and the board.
For the FY23 annual formal inhouse self-assessment, the
performance of each director was evaluated by the other
board members, using an evaluation questionnaire. The chair
of the board discussed results with each director and agreed
on any training needs or areas requiring attention by that
director. Where a director’s performance is not considered
satisfactory, the board will not recommend their re-election.
A consolidated summary of the evaluation was reported to
and discussed by the board, including any actions required.
The lead independent director leads the discussion on the
performance of the chair, with reference to the results of the
evaluation questionnaire, and provides feedback to the chair.
The board is satisfied that the evaluation process improves its
performance and effectiveness.
The formal annual evaluation process showed that the board
and its committees had functioned well and discharged their
duties as per the mandates in their charters. The results of the
board evaluation indicated that board members, collectively
and individually, effectively discharged their governance roles.
There were no remedial actions identified.
The primary objective of the social, ethics and sustainability
committee is to assist the board in ensuring the company
meets its statutory obligations in terms of section 72 and
regulation 43 of the Companies Act. The committee is
responsible for overseeing and reporting on organisational
ethics, responsible corporate citizenship, sustainable
development and stakeholder relationships for the group,
taking into account specific disclosures and best practice
as recommended by King IV.
The committee comprises a majority of non-executive directors,
the chief executive, chief financial officer (alternate member)
and chief executive of Media24. It is chaired by Debra Meyer.
Nominations committee
The nominations committee assists the board to determine
and regularly review the size, structure, composition and
effectiveness of the board and its committees, in the context
of the company’s strategy.
The committee comprises a minimum of three non-executive
directors, the majority of whom are independent. It is chaired
by Rachel Jafta.
Human resources and remuneration committee
The main objective of this committee is to fulfil the board’s
responsibility for the strategic human resources issues of the
group, particularly focusing on the appointment, remuneration
and succession of the most senior executives. The committee
comprises a minimum of three non-executive directors. It is
chaired by Craig Enenstein.
Projects committee
The projects committee is an ad hoc entity acting on behalf of
the board in managing urgent issues when the board is not in
session, subject to statutory limits and the board’s limitations
on delegation. It comprises two non-executive directors, one
independent non-executive director plus two executive
directors. It is chaired by Koos Bekker.
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The board and its committees continued
Audit committee
Induction and development
Discharge of responsibilities
The board is satisfied that the committees properly discharged
their responsibilities over the past year.
Furthermore, the board complies, to the best of its knowledge,
with the Companies Act and its memorandum of incorporation
and monitors such compliance continually.
Members
SJZ Pacak (chair)
M Girotra
AGZ Kemna
S Dubey
Capacity
Non-executive
Independent non-executive
Independent non-executive
Independent non-executive
Attendance at meetings
3/3 (100%)
2/3 (67%)
3/3 (100%)
1/1 (100%)
Mandate
Key focus areas going forward
The committee primarily oversees the integrity of the
company’s financial reporting, monitors the quality and
integrity of the company’s financial statements, reviews the
company’s internal controls and risk management.
Key focus areas during the year
During the financial year, the committee focused on:
» Considering the appointment of external auditors and
monitoring the transition for rotating external audit firms.
» Continuously evaluating internal financial reporting controls.
» Considering group tax matters.
» Evaluating the integrity and effectiveness of financial and
non-financial reporting.
» Considering the group’s impairment assessments.
» Reviewing going-concern assumptions, solvency and liquidity
testing and the proposed dividend consideration.
» Assessing the impact of changes to accounting standards.
» Assessing the suitability of the finance function, internal
auditors and external auditors.
The committee’s key focus for the 2024 financial year includes:
» Ensuring a smooth transition of auditors from PwC to
Deloitte.
» Assessing the impact of changes to accounting standards.
» Ensuring group reporting is in accordance with JSE Listings
Requirements and any other requirements which arise due
to Naspers’ listings.
» Ongoing compliance with King IV.
» Focusing regularly on the group’s working capital
requirements and ensuring the group and its subsidiaries
continue to operate as going concerns.
» Reviewing and monitoring accounting for potential
mergers, acquisitions and disposals and the conduct
of impairment tests.
Details of key audit matters and actions taken or conclusions
reached appear on page 130.
Steve Pacak
Chair: Audit committee
26 June 2023
An induction programme is held for new members of the
board and key committees, tailored to the needs of individual
appointees. This involves industry and company-specific
orientation, such as meetings with senior management to
facilitate an understanding of operations. Board members are
exposed to the main markets in which the group operates as
well as relevant evolving trends in technology and business
models.
The company secretary assists the chair with the induction
and orientation of directors and arranges specific training
if required.
The company will continue with directors’ development and
training to build on expertise and develop an understanding
of the businesses and main markets in which the group
operates.
Conflicts of interest
Potential conflicts are appropriately managed to ensure
candidates and existing directors have no conflicting interests
between their obligations to the company and their personal
interests. All directors are required to declare personal
interests annually. Declaration of directors’ interests is a
standing item on the board’s agenda. Directors who believe
there may be a conflict of interest on a matter must advise the
company secretary and are recused from deliberation and the
decision-making process, and the Companies Act process is
applied accordingly. Directors must also adhere to a policy on
trading in securities of the company.
Refer to note 44 ‘Related party transactions and balances’ on
page 172 of the consolidated financial statements, which sets
out the details of all related party transactions and balances.
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Audit committee continued
Significant reporting matter
Conclusions reached/actions taken
Significant reporting matter
Conclusions reached/actions taken
The committee received feedback from the group’s
representatives on the committees of Tencent and other
significant equity-accounted investments. The committee
reviewed the reporting of the contribution of equity-accounted
investments to the group’s results and financial position as
part of their review of the consolidated annual financial
statements. In addition, the committee received reporting
from management on significant transactions related to
equity accounted investments (ie dividends and disposals),
the significant lag-period adjustments and/or adjustments
made to the underlying results of investees to align the
investees’ accounting policies to those of the group.
The committee was satisfied with the adjustments made
and the critical judgements applied by management.
Applicable to the consolidated financial statements
Accounting for the equity-accounted investments in Tencent
Holdings Limited (Tencent)
Equity-accounted investments (refer to notes 10 and 11) are
significant to the consolidated annual financial statements
and the group is required to make certain adjustments to the
underlying results of investees in respect of any significant
transactions that occur between the investees’ year-ends and
31 March.
These adjustments require the exercise of critical
management judgement and are significant in terms of
magnitude.
Accounting for the group’s investment in Tencent was a
significant matter due to the magnitude of the carrying
amount, the significant contribution of the entity to the
consolidated results of the group and the fact that Tencent
has a year-end that is not coterminous with that of the group.
In June 2022, the group began executing an open-ended
share repurchase programme aimed at increasing the
Naspers and Prosus net asset value per share. The
repurchase programme is funded by an orderly on-market
sale of Tencent shares held by the group.
During the course of the financial year, the group sold 2.65%
of Tencent’s issued share capital resulting in a gain on
partial disposal of US$7.6bn. Management calculated the
gain on partial disposal as the excess of the proceeds
received on the disposal over the proportion of the carrying
value of the investment disposed.
In November 2022, Tencent declared a special interim
dividend in the form of shares in Meituan Inc. which was
distributed on 24 March 2023. Management accounted for
the dividend received from Tencent relating to Meituan Inc.
as a reduction of the carrying value of the investment in
associate and the recognition of a fair value through other
comprehensive income investment at the fair value on the
date of distribution, amounting to US$4.5bn
For further information refer to note 2 and 10.
Impairment assessment of goodwill and intangible assets
arising from business combinations and investments in
associates
Goodwill and intangible assets
The group’s net asset value includes significant amounts of
goodwill and intangible assets (refer to notes 7 and 34).
These balances are tested at least annually for impairment
at the level of individual cash-generating units (CGUs). The
recoverable amounts of the CGUs were based on either the
fair value estimates by reference to recent funding rounds or
market transactions (where applicable) or value in use
estimates using discounted cash flow models. This process
involves complex calculations and the exercise of critical
management judgement regarding assumptions
and estimates.
The committee received impairment reporting from
management including the results of the group’s annual
impairment testing of goodwill and those assets where
indicators of impairment existed. The committee reviewed this
reporting in terms of the consistent application of
management’s testing methodology, the achievability of
business plans and forecasts based on current and past
performance, the Naspers board approval thereof and the
critical assumptions applied.
In addition, as impairment testing remains a key area of
focus for the group’s external auditor, the committee reviewed
the external auditor’s reporting on impairment testing and
the valuations used for this purpose. The committee also
received detailed written feedback from management on
how valuation principles, areas of judgement and forecasts
have been impacted by current economic conditions.
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The announcement of the group’s decision to exit the OLX
Autos business due to ongoing macroeconomic and market
challenges in March 2023 resulted in the need to update the
goodwill impairment assessment performed at
31 December 2022.
Investment in associates
Impairment assessments for the group’s listed equity-
accounted investments related to Delivery Hero and Skillsoft
as a result of a decline in the market capitalisation and the
increase in country risk premiums for these investments.
Impairment assessments for the group’s unlisted equity-
accounted investments related primarily as a result of the
increase in market interest rates and the overall business
performance.
Share-based payments
The group has several share-based compensation schemes
(refer to note 38). The share-based payments arising
therefrom involve complex valuations and the use of critical
management judgement regarding assumptions, the
classification of the schemes and estimates.
Valuation of share-based compensation schemes and
share-based payments
The group has several share-based compensation schemes
(refer to note 38). The share-based payments arising
therefrom involve complex valuations and the use of critical
management judgement regarding assumptions, the
classification of the schemes and estimates.
The impairment assessments for equity-accounted associates
and joint ventures considered the financial performance of
the investments during the period and determined whether
there were any significant indicators, such as a decline in the
market capitalisation for listed investments, significant market
movements or any material financial losses for unlisted
investments, that would result in an impairment loss.
The group used its budgets and forecasts to perform
discounted cash flow valuations or market prices where
relevant, in order to determine the recoverable amount (the
higher of its value in use and listed market prices) of its
equity-accounted associates and joint ventures to identify
whether any impairments should be recognised.
Of all listed equity-accounted investments, impairment
indicators were identified for Delivery Hero and Skillsoft due
to the decline in their respective market capitalisations in
respect to their carrying values. Impairment losses were
therefore recognised for these investments as a result the
impairment assessment.
For all unlisted equity-accounted investments impairment
losses were recognised due to the financial performance
falling below expectations during the current year.
The committee received a report detailing the impairment
considerations as well as the reasons the impairment losses
were recognised for equity-accounted investments.
Based on the above impairment assessments, the committee
was satisfied with the appropriateness of the analysis
performed by management and the impairment-related
disclosures in the consolidated annual financial statements.
The committee acknowledged that the human resources and
remuneration committee reviews the valuations, including
assumptions and allocations, of the share-based
compensation schemes as well as the various scheme rules.
The committee noted the report of the human resources and
remuneration committee will be tabled at the Naspers board
meeting in August and will detail the results of these reviews
as per the normal process. The committee noted that these
valuations and the underlying assumptions are used for the
accounting of share-based payments.
The committee also reviewed the accounting and disclosure
of share-based payments in the annual financial statements.
As a result, the committee concluded that accounting and
disclosure of share-based payments in the consolidated
annual financial statements is appropriate.
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Risk committee
Members
SJZ Pacak (chair)
RCC Jafta
AGZ Kemna
V Sgourdos
B van Dijk
Capacity
Non-executive
Independent non-executive
Independent non-executive
Executive
Executive
Attendance at meetings
3/3 (100%)
3/3 (100%)
3/3 (100%)
3/3 (100%)
3/3 (100%)
Social, ethics and
sustainability committee
Members
D Meyer (chair)
RCC Jafta
FLN Letele
V Sgourdos (alternate)
JDT Stofberg
B van Dijk
MI Davidson
Capacity
Attendance at meetings
Independent non-executive
Independent non-executive
Non-executive
Executive
Non-executive
Executive
Executive
2/2 (100%)
2/2 (100%)
0/2 (100%)1
2/2 (100%)
2/2 (100%)
2/2 (100%)
2/2 (100%)
Mandate
Key focus areas going forward
ahead of the meeting.
1 Unable to attend meetings due to long-standing commitments and urgent family matters. However, Mr Letele provided input on matters to be addressed
The committee assists the board in its oversight of
the management of risk and risk governance in the group.
Furthermore, the PayU risk advisory committee reports to the
risk committee to ensure PayU management receives external
independent advice and acts as an independent guardian
to the risk committee on PayU-related matters.
An ongoing focus on managing changes in the
risk environment, particularly for legal compliance, tax,
sustainability and information, and technology-related risks
such as cybersecurity, data privacy (specifically the
implementation of the EU’s General Data Protection
Regulation) and the use of data-driven technologies.
Steve Pacak
Chair: Risk committee
26 June 2023
Key focus areas during the year
» Recognising material risks to which the group is exposed
and ensuring that the culture, policies and systems are
implemented and functioning effectively.
» Implementing and monitoring the processes of risk
management and for integrating this into day-to-day
activities.
» Ensuring risks are adequately identified, evaluated and
managed at the appropriate level in each business,
and that their individual and joint impact on the group
is considered via the enterprise-wide risk management
process.
» Monitoring the business insurance profile and insurance
claims in progress.
» Particularly focusing on data privacy, cybersecurity,
sustainability, tax and IP.
Details of how we manage, govern and monitor information
and technology, and compliance appear on pages 89 to 91.
Details of how risk, compliance, and information and
technology are managed to result in the objectives
recommended by King IV are contained in the King IV
application report.
Mandate
Key focus areas going forward
The committee recognises that areas in its mandate are
evolving and that management’s responses will also adapt to
changes in the ESG agenda.
Legislation on ESG matters is rapidly developing. Particular
attention will be paid to the group’s journey to compliance
with the evolving ESG legislative landscape.
Management will continue to improve techniques in how it
reports to the committee on responsible corporate citizenship
and sustainability, using ever-evolving legislation and the
United Nations Sustainable Development Goals (UN SDGs).
Accordingly, the group will continue to enhance the way it
reports on corporate citizenship and sustainability to its
stakeholders in the annual report.
Debra Meyer
Chair: Social, ethics and sustainability committee
26 June 2023
The committee fulfils statutory duties set out in regulation 43
of the Companies Act, has oversight of and reports on
organisational ethics, responsible corporate citizenship,
sustainable development and stakeholder relationships.
It assists the board in developing and supervising the
implementation of a long-term value-creation strategy,
by bringing to the board’s attention relevant sustainability
matters, matters relating to business ethics and culture,
and speaking up and other relevant stakeholder interests.
Key focus areas during the year
» Stakeholder interests and relevant sustainability aspects and
matters relating to business ethics and culture and the
speak up policy.
» Skills and other programmes aimed at the educational
development of employees.
» Employment philosophy founded on promoting equality and
preventing unfair discrimination.
» Labour practices and policies, and how these compare to
the International Labour Organization on decent working
conditions.
» Corporate social investment programmes, including details
of donations and charitable giving.
» The progress of addressing the principles of the UN Global
Compact and OECD guidelines.
» Consumer relationships, including the company’s
advertising, public relations and compliance with consumer
protection laws.
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Nominations committee
Human resources and
remuneration committee
Capacity
Attendance at meetings
Members
Capacity
Attendance at meetings
Members
RCC Jafta (chair)
JP Bekker
HJ du Toit
CL Enenstein
Independent non-executive
Non-executive
Independent non-executive
Independent non-executive
3/3 (100%)
3/3 (100%)
3/3 (100%)
3/3 (100%)
2/3 (67%)
R Oliveira de Lima
Independent non-executive
Mandate
The committee assists the board in ensuring performance
of the board, its committees and directors. It reviews the
composition of the board and its committees and
recommends suitable candidates to fill vacancies in these
governance structures and reviews continuous development
programmes for directors.
Key focus areas during the year
» Evaluating the board composition to ensure it appropriately
reflects the required skill set and diversity.
» Assessing the composition of the board to execute its duties
effectively.
» Assessing the effectiveness of the board, its members and
committees through a board-evaluation process.
» Evaluating the performance and independence of the
company secretary.
Key areas of focus going forward
Focus areas for the committee going forward will include:
» Assessing the composition of the board to execute its duties
effectively.
» Evaluating the board, including structure, size, composition,
balance of skills, experience and diversity of the board and
its committees.
» Ensuring there is a succession plan in place for the role of
chair of the board.
Rachel Jafta
Chair: Nominations committee
26 June 2023
CL Enenstein (chair)
Independent non-executive
JP Bekker
Non-executive
R Oliveira de Lima
Independent non-executive
4/4 (100%)
4/4 (100%)
4/4 (100%)
Mandate
Remuneration report
The committee assists the board in ensuring remuneration
policies and practices are aligned to the company’s objectives
for value creation and benchmarked to ensure fairness and
competitiveness in remunerating employees to attract and
retain key talent and critical skills required to deliver business
goals and results.
Key focus areas during the year
Please refer to the remuneration report.
Key focus areas going forward
Key focus areas for the year ahead, include:
Having achieved its objectives for the financial year,
the committee sets out remuneration disclosure in the
remuneration report, comprising our overarching remuneration
policy for executive directors and non-executive directors, and
commentary on how it has been implemented during the year.
The remuneration report is prepared in accordance with the
requirements of King IV. It is divided into three sections
(background statement, remuneration policy and
implementation) and is detailed on pages 136 to 166.
Craig Enenstein
Chair: Human resources and remuneration committee
» Continued engagement with shareholders on remuneration
26 June 2023
topics.
» Ongoing monitoring of market developments to ensure our
remuneration structure allows us to compete globally for
talent and that our offering is compelling, fair and
responsible.
» Achieving an appropriate mix of longer-term incentives,
including those to which explicit performance conditions
are attached.
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Remuneration report
We aim to attract,
motivate and retain
the best people to
create sustainable
shareholder value.
Craig Enenstein
Chair: Human resources and
remuneration committee
Members of the committee
» CL Enenstein (chair)
» JP Bekker
» R Oliveira de Lima
Dear shareholder
On behalf of the board, I am pleased to present our
remuneration report for the 2023 financial year (FY23).
Despite continued global turmoil and uncertainty, the group
has recorded a solid operational performance. In line with our
strategy, we have concentrated on building strong momentum
in our Ecommerce portfolio, driving for profitability.
Business performance1
On a consolidated basis, total revenue from continuing
operations increased by US$500m, or 8% (20%), from US$6.3bn in
the prior period to US$6.8bn. This was primarily due to strong
revenue growth in iFood, and Payments and Fintech.
Trading losses increased to US$844m from US$686m,
representing increased organic investments to scale ecommerce
extensions. However, trading losses in the second half of the year
improved by 21% compared to the first half, demonstrating the
group’s commitment to achieve consolidated ecommerce
profitability on a monthly basis in the first half of FY25.
The group’s free cash outflow (excluding Avito) was US$518m, a
sizeable year-on-year improvement. This was due to improved
working capital and lower withholding tax due to fewer Avito
dividends being received. Excluding OLX Autos, free cash
outflow was limited to just US$138m. Tencent remains a
meaningful contributor to the group’s cash flow via a stable
dividend of US$565m.
Core headline earnings were US$1.1bn – a decrease of 48%
(14%) or US$1.0bn, primarily due to lower contributions from the
group’s associates (US$1.3bn), of which US$1.1bn relates to
Tencent.
Discount to net asset value
For FY23, in response to shareholder feedback, we introduced
a discount-related, short-term incentive for the CEO and CFO.
The board approved an open-ended repurchase programme
of Prosus and Naspers shares, designed to efficiently unlock
immediate value for shareholders and increase NAV per
share over time. Funded by the regular sale of Tencent shares,
the programme will remain active while the discount to NAV is
at elevated levels.
1 In presenting and discussing our performance, we use certain alternative performance measures not defined by IFRS, referred to as non-IFRS-EU financial measures,
alternative performance measures or APMs. Such measures include economic-interest-basis information; trading profit; adjusted EBITDA; headline earnings; core
headline earnings; and growth in local currency, excluding acquisitions and disposals. Numbers included in brackets represent the equivalent measure on the basis
of growth in local currency, excluding acquisitions and disposals.
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We did not award longer-term incentives to the CEO and CFO
for FY23.
During FY23, the discount, measured over the period of the
programme through to the end of the fiscal year, saw a
reduction in the discount from 58% to 42%, the discount
reduction representing value creation of approximately
US$25bn, which represents a material improvement in the
discount. The above-mentioned special incentive will be held
in reserve until 31 March 2024 and remeasured against a
clawback provision.
The committee has not awarded a similar incentive for FY24.
Details of FY23 remuneration for executive directors appear
on page 148 of this report.
Executive director remuneration
For FY24, to incentivise long-term value creation, growth and
shareholder alignment, we have returned to a more typical
mix of incentives within the executive directors’ remuneration
packages and have once again awarded longer-term
incentives, with a similar mix to the prior years.
Rotation of independent valuations firm
FY23 marks the first financial year for which KPMG has been
responsible for performing the valuation work on our
ecommerce assets, with Deloitte having stepped down at the
end of FY22. We thank Deloitte for the work carried out.
Disclosures
We continue to focus on improving our disclosure on executive
remuneration, in line with shareholder feedback and our bid
for greater transparency. In addition to disclosing STI goals
and achievements for FY23, we now disclose related targets
retrospectively; this enhanced disclosure will enable an
informed assessment of management’s performance linked to
incentive awards.
Our stakeholder engagement
We engage frequently and take extensive input from our
investors to clearly demonstrate the link between Naspers’
strategy, business performance and remuneration philosophy.
Each year, feedback from investor meetings is considered and
debated by the remuneration committee as we continue to
refine remuneration design and disclosure.
Recently, the inclusion of a discount-related incentive in the
FY23 executive director remuneration packages and our
enhanced disclosure around the KPIs associated with
short-term incentives are examples of this input in action.
We strive for a higher level of N shareholder support for
remuneration resolutions. In that spirit, we will continue to
make appropriate changes to our remuneration design and
Key focus areas during the year
» Reflecting the business performance in the FY23
remuneration decisions.
» Ensuring correct pay-for-performance mix is applied.
» Setting regular short-term incentive (STI) targets, including
environmental, social and sustainability (ESG) goals that
are measurable, sufficiently stretched and linked to the
group’s strategy.
» Improving disclosure on executive remuneration in the
annual report, in a bid for greater transparency.
» Continuing engagement with shareholders on
remuneration topics and making design adjustments in
response, where appropriate.
» Ongoing monitoring of market developments to ensure
our remuneration structure allows us to compete globally
for talent, and that our offering is compelling, fair and
responsible.
Structure of report
In compliance with King IV, this report is split into the
following sections:
1 Background and policy: Provides a detailed view of
our approach to remuneration and information on the
components of our executive pay packages.
Read more on page 138.
2 Implementation of the remuneration policy:
Sets out information on how we implemented
our policy for FY23.
Read more on page 146.
We conclude with an additional information section on
page 165.
Note: All remuneration is presented at 100%, including the
cost apportioned to Naspers.
disclosures. We will also continue to engage with our
shareholders frequently.
I thank you for your feedback and support, and look forward
to our future interactions.
Craig Enenstein
Chair: Human resources and remuneration committee
26 June 2023
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Background and policy
Our 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. We strive to pay fairly
and responsibly. As much as possible, the structure of our pay
is consistent, regardless of the seniority of the employee,
ensuring equality of pay structures across all employees.
In the committee’s view, the remuneration policy achieved
its stated objectives in the year under review.
Five key principles to guide our remuneration approach
Our competitive environment for talent
A global market for talent
We are a global rather than a South African company, operating in a highly competitive international environment. Most of our
competitors are not listed in Johannesburg. Our remuneration practices are aligned within a global technology landscape and
may differ from what is customary in the South African context. Executive talent comes from other international, often leading
US-listed companies in the consumer internet sector, which forms the basis of our executive remuneration benchmarking.
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Paying for
performance
Shareholder
alignment
Achieving the
business plan
Consistency
» 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
» We are consistent:
incentivise the
achievement of
strategic, operational,
sustainability and
financial objectives, in
both the short and
longer term.
Our reward package
elements are broadly
the same, regardless
of seniority1.
Attracting and
retaining talent
» Our reward systems
must help us attract
and retain the best
talent around the
world in a fair and
responsible way.
Fair
Equitable:
Equal pay for work of equal value
Relevant:
Linked to personal and company performance
Rational:
Easy to explain
Responsible
Independent:
With oversight, top-down via the board
Managed:
All employee pay decisions are properly overseen
Considered:
Judgement is applied – we shy away from
solely formulaic appraisals that could lead to unacceptable
outcomes
Sustainable:
Remuneration designed with sustainability in mind
We strive to deliver fair and consistent remuneration
across all our business operations.
Maintaining pay equality is embedded in our ways of
working. Through regular analyses we compare
compensation levels of groups of people, for example,
women versus men performing in similar jobs. We
conduct calibrations across the group as a standard
process before (annual) reward decisions are taken,
working towards closing unjustified pay gaps, should
they exist.
1 Long-term incentives (LTIs) are an important element of compensation for key employees, but in general are not broadly granted, in line with market practice.
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Making executive pay decisions
Pay for
Pay for performance
performance
Achieve the business
plan
Achieve the business plan
Attracting and retaining talent
Attracting and retaining talent
Fair, responsible,
Fair, responsible and consistent
consistent
Market situation – benchmarking
Shareholder
alignment
Longer term
Peer group
Scenario analysis
Individual
performance
as per STI
Business
performance
When making executive pay
decisions, we consider the
individual’s performance and
the performance of the
business.
AON
Radford
data
high-tech
sector
Willis
Towers
Watson
(WTW) data
high-tech
sector and
general
industry
We partner with local data
providers in the countries in
which we operate and with
these two global providers
of benchmarking
information. Survey
coverage is specifically
strong in the US, Western
Europe and in high-growth
markets. We access its
general industry and
high-tech surveys, including
media and technology.
Committee deliberation
Pay decision
Where appropriate and
available, we look at
publicly disclosed data that
are more or less
comparable in the
ecommerce, consumer
internet, food-delivery and
social media sector.
The committee undertakes
a thorough assessment to
ensure that targets on
variable incentives are
sufficiently stretched in the
context of potential
remuneration delivered,
and applies judgement so
that the remuneration
policy continues to
achieve its objectives of
aligning pay with the long-
term performance of
Naspers and shareholder
outcomes.
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Background and policy continued
Our remuneration structure: Pay for performance
Executive director participation in LTI plans
PSUs
Remuneration for our executive directors (CEO and CFO) consists of base salary, STI, LTI, pension and other benefits. The
approach is similar for the CEO’s other direct reports.
Our pay design links to our pay principles
Pay for
performance
Shareholder
alignment
Achieving the
business plan
Consistency
Attracting and
retaining talent
Fixed
remuneration
» Base salary reflects the contribution of the individual and market value of the role.
» Paid monthly in cash.
» May be reviewed annually; any increase is typically effective from 1 April each year.
» Benefits typically include pension, medical insurance, and life and disability insurance.
STI –
Annual
performance-
related
incentive
» Discretionary annual performance-related incentive with performance measures tailored to the executives’
roles and responsibilities.
» At least 50% of the bonus opportunity is based on delivering financial performance ahead of the board-approved
business plan.
» Sustainability goals are set for the short and longer term.
» Target and maximum bonus opportunities are the same (no payout for over-performance against target), and the
standard STI is set at 100% of base salary for both the CEO and CFO.
» The committee undertakes a thorough assessment to ensure targets are rigorous and sufficiently stretched.
STI payout is typically below the maximum 100% opportunity.
» Any STI payout is made in cash.
» The committee may apply judgement with discretion to make appropriate adjustments to the annual bonus.
» The committee may consider an additional cash short-term incentive, aligned to specific shareholder interests,
of no more than five times the annual fixed gross salary.
LTI –
Performance
share units
(PSUs)
» PSUs are designed to incentivise the increase in the value of internet businesses (excluding Tencent) and delivery
of superior returns to shareholders.
» Three-year cliff-vesting, subject to achieving the performance condition.
» Performance condition is the three-year compound annual growth rate (CAGR) of the Global Ecommerce SAR
scheme, relative to a group of industry peers.
» Vested PSUs are settled in shares.
» Further details on
page 141.
LTI – Share
appreciation
rights (SARs)
» SARs incentivise the growth in value of the business units or an aggregation of underlying assets.
page 142 for details on the valuations process and the valuation performance of the Ecommerce
See
portfolio linked to the SARs plan.
» Any value upside delivered by individual businesses is offset by any value downside delivered by other businesses.
This ensures that senior executives’ remuneration is negatively affected if individual businesses do not perform.
» The change in value is measured over a four-year period to ensure focus on the longer-term delivery of
shareholder value.
» Any gains are settled in cash.
LTI – Share
options (SOs)
» SOs: Any gains are based on the growth in share price over a four-year period.
» Performance hurdle: Value is only delivered to participants if there is an increase in the share price.
» Any gains are settled in shares.
Malus and clawback provisions apply to STI and LTI.
Achievement of the performance condition will be assessed
by the human resources and remuneration committee,
based on the share price of the Global Ecommerce SAR Plan
(in absolute and relative terms), validated by the valuations
subcommittee as per the valuations process described on
page 144.
The level of achievement relative to the performance condition
at the end of the three-year performance period drives the
number of shares that ultimately will vest:
» At threshold performance: 50% of allocated shares would
be awarded if performance is at the 25th percentile of the
peer group.
» At target performance: 100% of allocated shares would be
awarded if performance is at the median of the peer group.
» At maximum performance: 200% of allocated shares
would be awarded if performance is at the 75th percentile
of the peer group.
The PSU threshold level of achievement is deliberately set at
the 25th percentile, as it is positioned against a highly
competitive set of comparator companies, as referenced
below1.
If the threshold level of performance is not achieved,
no shares will be awarded to the participant. If more than
maximum performance is achieved, no more than 200%
of allocated shares would be awarded.
The board remains committed and incentivised to continue on
the journey for long-term value creation of the group. To
emphasise that intent, FY24 remuneration will be adjusted
accordingly. Further details can be found on page 149.
The committee reviews three key elements before conducting
the scenario analysis, to determine the size of any award
of PSUs, SARs or SOs:
» Strong short-term (annual) personal performance leading
to a decision to grant an LTI.
» Superior business performance over the executive’s tenure,
leading to value creation in the scheme and for the
shareholder.
» Industry benchmarking of executive compensation in
consultation with external advisers Willis Towers Watson
and FW Cook.
LTI awards represent a significant portion of total
compensation. They are designed to incentivise the delivery of
sustainable longer-term growth and provide alignment with
our shareholders.
The entirety of our executive directors’ LTI is determined by
the performance of the company and growth in the valuation
of the underlying assets and, as such, is deemed ‘at risk’.
LTI is only delivered to executive directors, providing the
PSU performance conditions are met and the share price of
SARs or SOs has increased in value, ensuring strict alignment
with our wider stakeholder interests.
Detailed scheme rules provide for the operation and
governance by trustees of each scheme.
A blend of LTI
Our executive pay is heavily weighted towards longer-term
performance, typically delivered via PSUs, SARs, and SOs.
Each element of the LTI programme plays a distinct part in
implementing a remuneration approach that drives business
performance for the longer term and is fair, responsible,
consistent, aligned with shareholder outcomes and relevant to
the talented executives we need to attract and retain
(see table on page 138).
In recent years, we focused on compensating executive
management on the performance of the global Ecommerce
portfolio, excluding Tencent. In FY22 (when LTI was most
recently granted), the PSU plan and SARs plan together made
up 92.5% of the LTI allocation:
» PSUs – measures the three-year CAGR valuation of the
Ecommerce portfolio against a basket of global peers1.
» SARs – measures the value creation of directly controllable
factors in the global Ecommerce portfolio.
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141
1 The 31 March 2023 peer group consists of Adevinta, Adyen, Alphabet, Amazon, Auto Trader Group plc, Booking Holdings, Deliveroo, DoorDash, eBay, Expedia
Group Inc., IAC/InterActiveCorp, Just Eat Takeaway.com, Mercado Libre, Meta, Netflix, Ocado Group, PayPal Holdings, Sea Limited, Snap, Square, Wayfair Inc.,
Zalando SE and Zillow Group. Twitter was removed following its delisting in November 2022.
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Background and policy continued
Blend of LTI
PSU
Global Ecommerce SAR
SOs
Plan characteristics
Performance
Settlement
A performance share award
that is transferred to
participants after time
restrictions have passed,
subject to the performance
condition being met.
PSUs typically vest in full on
the third anniversary of the
grant, subject to the
performance condition
being met.
Performance is determined
based on verifiable financial
results and metrics.
Depending on achievement
against performance
condition, between 0% and
200% of awarded PSUs may
vest and Prosus or Naspers1
shares are delivered2 on
vesting.
A right to benefit from any
increase in value of the
business unit over which
an award is made.
Vests over four years.
A right to buy a company
share at a pre-agreed price.
Vests over four years.
Embedded with a
performance hurdle as there
is no value to be gained
unless there is an increase in
share value in the underlying,
unlisted consumer internet
businesses (excluding
Tencent) between grant and
vesting/exercise.
Gains, if any, are settled
in cash.
Embedded with a
performance hurdle as there
is no value to be gained
unless there is an increase in
share value between grant
and vesting/exercise.
Upon exercise, SOs are
settled in Naspers or
Prosus shares1, 2.
Focus on longer-term value
creation
Value driven by longer-term
outcomes.
Valuation (by third party)
driven by longer-term
projections3.
Market cap represents
longer-term value.
Alignment with shareholder
interests
PSUs align the business
strategy and objectives with
executive compensation and
shareholder returns.
Incentivises value creation in
underlying ecommerce
businesses (excluding
Tencent).
Aligned with shareholders
incentivising executive
management to reduce
the discount to NAV.
Valuations
2023 valuation outcome
The group’s assets are on track for consolidated profitability
as communicated to investors, while our businesses continue
to identify additional investment areas to expand their overall
opportunity sets. Despite this, a decline in the value of the
portfolio will reflect the re-rating of all our listed assets,
including Delivery Hero in particular, and to a lesser extent a
decline in the value of our unlisted assets where the market
inputs, like risk-free rates, increased compared to 2022 and
will drive lower valuations. We continue to see declines in the
private market valuations, closing the gap to the declines
experienced in the public company valuations.
These declines in the market were noted at 30 September
2022 and, given the meaningful downward market movements
and rising inflation resulted in higher interest rates, the
decision was taken to perform an interim valuation at
30 September 2022.
For the financial year, the group’s assets continued to perform
to their plans with a commitment to deliver consolidated
Ecommerce trading profit during the first half of FY25. The
updated valuations at 31 March 2023 reflect the performance
of our businesses in the context of the continued difficult
macroeconomic environment.
The Global Ecommerce portfolio
The performance of SARs and PSUs are determined by
year-on-year changes in the per-share valuation of the group’s
Global Ecommerce portfolio. The Global Ecommerce scheme
excludes the performance of Tencent.
Methodology
The valuation is an amalgamation of a number of individual
schemes and assets which are valued annually, or in the
interim if required, by an independent external valuer. In
determining the company value and the scheme share value,
the valuer shall use the appropriate application of reasonable
valuation methods, including, without limitation, the use of
comparable peer multiples, precedent transactions and
discounted cash flow (DCF) valuations. Importantly, the
methodology deployed in valuing the ecommerce schemes
has remained consistent since inception, which is essential
both for the legitimacy of the valuation and for transparency
for the scheme participants.
Where predominantly employing a DCF methodology, the
valuer is using assumptions for future cash generation,
discount rates and long-term growth. These valuations assess
the pathway to value creation and should serve as a critical
component of a comprehensive compensation vehicle
designed to align management performance and
compensation, excluding Tencent, with shareholder outcomes.
It is also important to note that funding is initially dilutive to
value, and many of our companies are early-stage or
loss-making, meaning that the schemes are diluted by
short-term investment and acquisitions. The Global Ecommerce
portfolio scheme is made up of underlying schemes, each of
which has a different set of assumptions.
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1 The issue of PSU and SO awards, if any, will gradually be rebalanced between Prosus and Naspers shares, aligned with the free-float ownership in Prosus and
Naspers.
2 Shares are purchased on the market for cash to avoid shareholder dilution as a result of the company settling its LTI award obligations.
3 Please see page 144 for further details on the valuation process.
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Background and policy continued
Governance of our valuation process
Service contracts
Valuation process
Underlying business submits
10-year business plan and
annual budget.
Naspers reviews the 10-year
business plans for each
underlying business and
provides them to the
external valuer.
Independently from
management, the valuer
values the underlying assets
at 31 March annually and
additionally, whenever a
significant change occurs.
The valuer issues a report
detailing the valuation for
each of the underlying
operations.
Segment schemes and the ecommerce schemes are a ‘basket of assets’
representing the valuation of the underlying operations
➊ Report issues
The external valuer1 issues
a report with the respective
share scheme valuations.
Governance
➌ Submission
Reports from the valuer and
the valuations subcommittee
are submitted to the human
resources and remuneration
committee as part of their
approval process.
➋ Review
The valuations subcommittee
of the human resources and
remuneration committee
reviews the valuations before
recommending the values for
approval to the human
resources and remuneration
committee. The subcommittee
consists of members of the
board: Craig Enenstein
(chair) and Steve Pacak.
➍ 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 SARs or SOs at these
updated prices in
accordance with the
trading-in-securities policy.
1 The group has appointed KPMG as the new external valuer, conducting the valuations for the group’s unlisted assets from FY23 onwards.
Ecommerce portfolio and SARs performance 2021 to 2023
Ecommerce valuation (US$’m)
Ecommerce valuation growth
SAR share price (US$’m)
Notional shares
2021
20221
2023
39 109
35 780
28 049
76.6%
64.28
(8.5%)
49.91
(22%)
38.11
15 210 390
17 923 495 18 401 174
1 Adjusted to account for the disposal of Avito. As reported last year, vesting of the first PSU awards was delayed by our announced intention to decouple Avito
operationally from the group.
Governance
Recruitment policy
On appointing a new executive director, their package will
typically be in line with our remuneration policy. 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 cash or LTI may be used.
Termination policy
Payments in lieu of notice may be made to executive directors,
comprising salary for the unexpired portion of the notice
period. Such payments may be phased. On termination, there
is no entitlement to an annual performance-related incentive
(STI). 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, considering pro-rating for
time and actual performance achieved.
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There is no entitlement to a particular severance package
in executive directors’ contracts.
Malus and clawback
Malus and clawback provisions apply to STIs and LTIs
awarded to executive directors and the CEO’s direct reports
(in line with article 135(6) and (8) of Book 2 of the Dutch Civil
Code and the remuneration Policy). All or part of the unpaid
STI may be modified or cancelled and all or part of the
unvested LTI may be modified or cancelled. In addition, all or
part of the vested LTI may be claimed back. Malus and
clawback provisions may be invoked for certain material
events, including cases of material financial misstatement or
gross misconduct on the part of the executive director or
direct reports of the CEO.
Executive directors’ contracts comply with terms and conditions in the relevant local jurisdiction.
Date of appointment at the group
Date of appointment to current position
Employer notice period
Bob van Dijk
Basil Sgourdos
1 August 2013
1 August 1995
1 April 2014
1 July 2014
Six months
Three months
Other non-executive roles
Non-executive directors’ terms of appointment
The board has procedures for appointing and orienting
directors. The nominations 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 input in identifying potential candidates and we
frequently engage the services of a reputable search firm.
Members of the nominations committee propose suitable
candidates for consideration by the board. A fit and proper
evaluation is performed for each candidate.
Retirement and re-election of non-executive directors
The governance structures of Prosus and Naspers substantially
mirror each other. Prosus and Naspers have an identical
one-tier board structure of executive and non-executive
directors.
All non-executive directors are subject to retirement and
re-election by shareholders every three years. 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.
Shareholder engagement
In FY23, we engaged with our shareholders through regular
in-person and online meetings, including the topic of
remuneration.
We have outlined the committee’s decision process
on remuneration on page 139. A remuneration section
is included on our investor pages on our website at
www.naspers.com.
Bob van Dijk stepped down as non-executive director of
Booking Holdings Inc. on 9 June 2022.
Neither Bob nor Basil Sgourdos holds any board positions
outside the Prosus and Naspers groups.
Shareholding requirement for the CEO
To reflect the balance of the underlying value of economic
interests between Naspers and Prosus, the CEO is required to
maintain a Naspers shareholding of four times his annual
salary and a Prosus shareholding of six times his annual salary.
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, 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
regularly 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 after
regular benchmarking that primarily considers international
comparators in the consumer internet and media sectors, as
well as the top 10 AEX-listed and JSE-listed companies.
Dual responsibilities
Non-executive directors receive no additional compensation
for their dual responsibilities to Naspers and Prosus. However,
the aggregate cost of their compensation is currently allocated
70% to Prosus and 30% to Naspers. The split was determined
based on the underlying assets and the amount of time
required to sufficiently assume the dual responsibilities.
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Implementation of
remuneration policy
Aligning remuneration to our strategy and performance
In this section, we outline how our remuneration policy for executive directors has been implemented in FY23 and how we intend
to operate it in FY24. All decisions on executive remuneration have been made in line with our remuneration policy for this
financial year and reflect our business performance.
Our strategy
» We partner with local entrepreneurs to build global technology leaders.
» We operate at the intersection of high-growth markets and technology to address major societal needs
Our business
priorities
Our financial
highlights1
Our operating
highlights1, 2
at scale.
» We build sustainable leadership positions in high-growth markets.
» We build businesses with big potential to address societal needs.
» Food Delivery
» Classifieds
» Payments and Fintech
» Edtech
» Etail
» Other: Ventures
» Social and internet platforms.
» Revenue US$33.2bn, -5% (7%), driven by a healthy 19% (29%) increase in Ecommerce segment revenues.
» Trading profit declined to US$3.3bn, reflecting a lower share of profits from Tencent and continued investment in our
Ecommerce growth extensions, which include: credit, quick commerce and grocery delivery.
» Core headline earnings decreasing to US$1.1bn.
» Ecommerce businesses consolidated revenue grew 8% (20%) to US$6.8bn, with the biggest contributions to growth from Food
Delivery, and Payments and Fintech. Consolidated trading losses from continuing operations of US$639m reflected our focused
approach to incremental investment in our Ecommerce growth extensions. Going forward, we expect a continued reduction in
trading losses in each reporting period as a result of continued efficiencies and cutting back aggressively on costs.
» Food Delivery continued to deliver robust growth in the core restaurant food-delivery business as well as in grocery
marketplace and quick commerce, while improving its overall profitability. Profit improvement was driven by increased scale
and margin improvement in the core restaurant food-delivery businesses, as well as a more targeted investment in growth
extensions such as grocery and quick commerce. Total gross merchandise value (GMV) grew 18% (27%), while revenue, on an
economic-interest basis, increased 40% (44%) to US$4.2bn.
» Core Classifieds businesses delivered sustained growth and improved profitability, driven by stable operating metrics and a
strong performance in Europe. However, core Classifieds was negatively impacted by currency movements. On an economic-
interest basis, revenue decreased in nominal terms but grew 15% to US$722m in local currency, excluding M&A, and reported a
trading profit of US$60m.
» Payments and Fintech continued to see meaningful growth in the core PSP (payment service provider) business and in its
burgeoning Indian credit business. The segment grew its economic-interest revenue 32% (51%) to US$1.1bn. On a consolidated
basis, the core PSP business and credit drove PayU’s revenue growth of 32% (52%) to US$903m. The trading loss was US$83m
(FY22: US$46m), at a negative margin of 9% (FY22: -7%) due to a once-off loss provision of US$23m. Excluding this provision,
the PSP business remained profitable.
» Edtech segment revenues grew by 28% (18%) to US$545m and trading losses increased to US$258m. Growth was affected by
decreased demand given the macroeconomic downturn. Our portfolio companies have reacted quickly to changing market
conditions and have begun to rationalise their cost structures and investments. Our majority-owned enterprise platforms, Stack
Overflow and GoodHabitz, continued to grow, driven by investments in sales headcount, product enhancements and global
footprint expansion, which weighed on profitability.
» Etail: eMAG had a mixed performance due to decreased consumer demand in a deteriorating macroeconomic environment,
the war in neighbouring Ukraine, and a needed restructuring of its Hungarian business. eMAG’s revenue declined by 14% (4%)
to US$2.0bn, reflecting a 17% (7%) local currency decline in its core Etail business, which was partially offset by strong growth
from its restaurant (Tazz) and grocery-delivery (Freshful) services. While overall GMV decreased 13% (4%), third-party (3p)
ecommerce business grew GMV 3% (14%) which was offset by a first-party (1p) decline of 20% (11%). These changes were
driven by changes in category mix, which is ultimately more supportive of margins. In total, the business reported a trading
loss of US$53m, compared to a US$34m trading loss last year.
Remuneration
outcome FY23
» We have focused on the path to profitability this year and met our COHE and FCF goals, but missed our organic
revenue growth target. The next page contains information on the annual charge of CEO compensation linked to the
performance of the company, as well as the FY23 remuneration for the CEO and CFO as shown in the single-figure
table. The outcomes of STI linked to all group financial goals and strategic, operational and sustainability goals are
disclosed on pages 150 and 151.
1 All figures from continuing operations.
2 In presenting and discussing our performance, we use certain alternative performance measures not defined by IFRS, referred to as non-IFRS-EU financial measures,
alternative performance measures or APMs. Such measures include economic-interest-basis information; trading profit; adjusted EBITDA; headline earnings; core
headline earnings; and growth in local currency, excluding acquisitions and disposals. Numbers included in brackets represent the equivalent measure on the basis
of growth in local currency, excluding acquisitions and disposals.
Aligning remuneration to our strategy
Compensation is substantially ‘at risk’ and longer term
In FY23, the remuneration committee emphasised the importance of reducing the discount to net asset value in the short term by
materially increasing the CEO and CFO’s short-term variable compensation exposure to this goal. The discount-linked incentive for
FY23 will only be paid out if the improvement is sustained or improved on, as at 31 March 2024. This was a unique event and a
further discount-related incentive is not part of the remuneration of the executive directors in the coming year (FY24).
The committee is focused on delivering executive incentives that are predominantly focused on longer-term value creation.
Remuneration mix awarded in FY23
Bob van Dijk (%)
Basil Sgourdos (%)
23
23
23%
23%
0%
54%
54
Annual fixed pay
Annual STI (target)
Annual fair value LTI
Discount-linked STI (target)
46
Annual fixed pay
Annual STI (target)
Annual fair value LTI
Discount-linked STI (target)
27
27
27%
27%
0%
46%
Business performance and remuneration outcomes
Executive directors’ remuneration versus company performance
CEO remuneration
Cash1 year-on-year change
LTI2 year-on-year change
CFO remuneration
Cash1 year-on-year change
LTI2 year-on-year change
Company performance
Organic revenue growth3
Organic revenue growth4 (excluding Tencent)
Ecommerce share price growth
FY236
(%)
FY22
(%)
FY21
(%)
FY204
(%)
CAGR5
(%)
145
(100)
98
(100)
7
31
(24)
(13)
(2)
(9)
(2)
24
50
(22)
5
3
5
17
33
51
55
9
28
13
26
23
32
15
25
(100)
21
(100)
20
35
1
1 Base salary + benefits + actual bonus payout, using the currency in which the CEO (in €) and CFO (in US$) are paid. The primary reason for the FY23 increase is the
inclusion of the discount-linked STI.
2 Fair value at grant, using the currency (US$) in which we grant LTIs.
3 Metric, excluding impact of foreign exchange (FX) and M&A.
4 FY20 growth measured from date of listing. It is noted that all remuneration is presented on a full-year basis and at 100%, including the cost that is apportioned to
Naspers.
5 Period CAGR is between FY20 and FY23.
6 Includes continuing operations (excluding a portion of OLX Autos).
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Implementation of remuneration policy continued
Single-figure table FY23 remuneration
The tables below show a single figure for the remuneration and the implementation of the remuneration policy in FY23 for the
executive directors. Salary increases were not awarded to the executive directors in FY23.
FY23 single-figure table
€’000
Variable remuneration
Base
salary
Standard
STI1
1 296
1 107
895
923
Discount-
linked
STI2
3 150
1 845
Executive director
Bob van Dijk, CEO
Basil Sgourdos, CFO
FY23 single-figure table
LTI3
Pension
Other
benefits4
Total
remuneration5
Proportion
of fixed and
variable
remuneration
0
0
85
87
46
10
5 472
3 972
24%/76%
28%/72%
US$’000
Variable remuneration
Executive director
Bob van Dijk, CEO
Basil Sgourdos, CFO
Base
salary
Standard
STI1
1 405
1 200
970
1 000
Discount-
linked
STI2
3 414
2 000
LTI3
Pension
Other
benefits4
Total
remuneration5
Proportion
of fixed and
variable
remuneration
0
0
92
94
49
16
5 930
4 310
24%/76%
28%/72%
1 Actual payout against FY23 performance; achievement of STI goals is shown on pages 150 and 151.
2 The discount-linked STI will be held and paid out after 31 March 2024 should the assessed discount be sustained or improved.
3 No LTIs were granted in FY23 to executive directors. The IFRS 2 expense recognised for unvested and vested but unexercised LTI awards at 31 March 2023
is -US$97.6m (-€93.6m) (2022: -US$27m (-€23.3m)) for the -US$4.1m (-€4.0m) (2022: US$4.3m (€3.7m)) for the CFO and does not reflect the impact of the non-
adjusting subsequent event on the intended sale of Avito. The total IFRS 2 expense is shown in note 44 – Related party transactions and balances (executive
directors’ remuneration) of the consolidated financial statements.
4 Medical insurance, life and disability insurance.
5 Executive directors are executive directors of both Naspers and Prosus. The costs of their remuneration as executive directors of these entities are split 10/90
between Naspers and Prosus. The remuneration paid to executive directors above reconciles with executive directors’ remuneration disclosed in note 44 of the
consolidated financial statements. In note 44, we show base pay, STI, pension and benefits at 10% of the aggregate cost as set out in this remuneration report, plus
the full IFRS 2 expense of the LTI per this footnote 3, minus the FY23 LTI awards in fair value at grant, as shown in this single-figure table.
Special discount-related short-term incentive
Discount-linked STI
A special one-year cash incentive related to reducing the
discount to net asset value was introduced in FY23. This
discount-linked STI will only be paid on successful discount
reduction at the discretion of the human resources and
remuneration committee.
subject to the one-year holding period which was
communicated at the outset.
The incentive will only vest, if at 31 March 2024 the discount
improvement is sustained or improved. To be clear, so long as
the discount at 31 March 2024 remains no greater than the
42% level indicated at 31 March 2023, the discount-linked
incentive will be deemed vested and then paid.
During the financial year, a new initiative was developed
whereby the group sold Tencent shares and purchased Prosus
and Naspers shares with the associated proceeds.
As of the end of the fiscal year, the Tencent sale and share
purchase programme remained active. No further discount-
related incentive is proposed for FY24.
The new initiative resulted in the sale of Tencent shares with a
market value of US$10.7bn and the purchase of a
commensurate amount of Prosus and Naspers shares.
During FY23, the discount, measured over the period
of the programme through to the end of the fiscal year,
saw a reduction in the discount from 58% to 42%, the discount
reduction representing value creation of approximately
US$25bn, which represents a material improvement in the
discount.
The reduction of the discount and value created during the
period represents a material improvement in the discount and
the committee has deemed that the incentive should be paid,
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CEO’s remuneration compared to average
employee remuneration
As we operate in high-growth economies where socio-
economic disparity can be large, societal fairness is very
important to us. As such, we ensure that our pay practices
around the world are fair and competitive and well above
minimum-wage standards. Pay is an important aspect, but not
the only consideration. In general, our people join us because
of the opportunity to do meaningful work where they can
make a difference and can learn and grow.
When reviewing the CEO’s remuneration, the human resources
and remuneration committee considers employee
remuneration globally across the group.
As a consumer internet company, we have a wide
geographical footprint. Most of our activities and employees
are based in high-growth countries, including India, Brazil,
Central and Eastern Europe, and South Africa. On a global
level, the CEO pay ratio versus employees (including LTI)
would be 253:1 (FY22: 347:1, FY21: 316:1, FY20: 311:1).
However, we do not consider the pay ratio to be an
appropriate measure of fairness given the widely different pay
levels observed in the countries where we operate.
If we compare CEO pay versus employees in the Netherlands
it shows a ratio of 30:1 (FY22: 40:1, FY21: 19:1, FY20: 22:1).
The decrease from FY22 to FY23 is due to the CEO not
receiving an LTI.
Also, as shown on page 147, the pay-at-risk portion for the
CEO and, within that, more specifically LTI as a result of
historical allocations, weighs heavily in our total executive
remuneration mix. This approach is typical within the consumer
internet and technology sector where we compete for talent.
For completeness, we have also reviewed pay ratios excluding
LTI, showing a ratio of 118:1 (FY22: 71:1, FY21: 75:1,
FY20: 72:1) globally and 22:1 (FY22: 14:1, FY21: 6:1, FY20: 8:1)
for the Netherlands.
The ratios are obtained by dividing the FY23 total
remuneration for the CEO by the FY23 average total
remuneration of all other employees (which includes salaries,
wages, on-target bonus, pension and benefits for employees,
excluding contractors). It excludes training and development
that we offer to our employees. Details of staff costs appear in
note 15 on page 80 of the consolidated financial statements.
Competitive pay – knowledge workers
We review the pay levels of our staff at least annually: relative
to pay in the markets and countries where we operate, our
reward levels are competitive. We see the effectiveness of our
reward philosophy and practices confirmed via our formal
employee engagement surveys. In recent years, most
employees find that they are paid fairly, relative to similar jobs
in other companies, reporting a high satisfaction level that is
above external benchmarks.
Fairness
We strive to deliver fair and consistent remuneration across all
our business operations. At all levels, we ensure our pay
practices around the world are fair, competitive and above
local minimum-wage standards. We ensure critical benefits
and protection for our entire workforce are in line with the
markets in which we operate.
Pay equality
Maintaining pay equality is embedded in our ways of working,
where we compare compensation of groups of people, for
example, women versus men performing in similar jobs. We
conduct calibrations across the group as a standard process
before (annual) reward decisions are taken, working towards
closing unjustified pay gaps, should they exist.
STI – FY23 goals, targets and achievements
Short-term incentives (STIs) are based on financial, strategic,
operational and sustainability performance targets tailored for
each role, including financial objectives on the underlying
business performance.
The minimum STI payout was 0% of base salary. The target
and maximum STI opportunity are the same at 100% of base
salary, ie there is no opportunity to overachieve on bonus
payout.
Measurements for bonus achievement were based on the
business plan for FY23.
We disclose STI goals and achievements for FY23, as well as
FY23 targets retrospectively, from this financial year.
In the annual report, we have highlighted metrics or
developments for FY23 that were included in the STI of
executive directors as indicated on pages 150 and 151.
Investing for sustainable long-term value
creation
Naspers competes with tech companies of every size in
the consumer internet industry worldwide. To compete
effectively, our assets need to reach scale – in user
numbers and markets served – relatively quickly. For
Naspers, this translates to significant investment and
support through their early loss-making years: our
diverse portfolio allows us to sustain this investment
phase or divest from assets that no longer meet our
stringent criteria. This is a strategic choice as we search
for entrepreneurs who can build global tech leaders
addressing societal needs in high-growth markets. At
the same time, we have an obligation to shareholders
who entrust their capital to Naspers to create
sustainable long-term value through disciplined capital
allocation and robust financial performance. Against our
stated goal of profitability across our core Ecommerce
segment by the first half of FY25, it is appropriate to
incentivise management to find the correct balance
between investing for growth and competing effectively.
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NASPERS
Integrated annual report 2023
149
Implementation of remuneration policy continued
Outcomes of STIs
The outcomes of the annual STI as shown below and on page 151 resulted in annual bonus payout levels of €895 168 or 69% of
base salary for Bob van Dijk (CEO) and US$1 000 243 or 83.3% of base salary for Basil Sgourdos (CFO).
All financial, strategic, operational and sustainability goals are measurable and validated.
FY23 goals and achievements
Bob van Dijk
Maximum STI opportunity: 100% base salary.
Group
financial goals1
Weighting
(%) Target
Actual results
Outcome2
Core headline
earnings
(including Tencent)
19.05 US$564m
US$1 056m
Free cash flow
19.05 -US$1.2bn
-US$518m
Strategic,
operational and
sustainability
goals
Ecommerce
financials1
Sustainability:
Diversity and
inclusion
38.10
Weighting
(%) Target
Actual results
Outcome
14.28 Organic revenue growth of 35%
29%
14.28 Trading loss of -US$1.85bn
-US$1.50bn
16.67 89% favourable response to the
question ‘I feel respected at my
company’ in the annual
engagement survey
86%; details can be found on
page 82
2
X
2
X
Sustainability:
Climate
sustainability
16.67 Reduce scope 1 and 2
emissions to zero at group
level3 by year-end FY23
Scope 1 and 2 emissions are
reduced to zero at group level3;
details can be found on page 100
61.90
Actual
payout
€246 965
€246 965
€493 930
Actual
payout
€0
€185 127
€0
€216 111
€401 238
1 Financial goals, actual results and outcomes based on Naspers economic interest results.
2 Outcome assessed after adjustments for M&A, foreign exchange/constant currency and other approved items.
3 As determined by the board. As part of our climate mitigation effort in FY23, our corporate offices located in London and Amsterdam procured green
electricity. For the other corporate offices in the scope of reporting and as part of our climate change mitigation, we have procured renewable-energy
certifications for our scope 2 emissions.
150
NASPERS
Integrated annual report 2023
FY23 goals and achievements
Basil Sgourdos
Maximum STI opportunity: 100% base salary.
Group
financial goals1
Core headline
earnings
(including Tencent)
Weighting
(%) Target
19.05 US$564m
Actual results
US$1 056m
Outcome2
Free cash flow
19.05 -US$1.2bn
-US$518m
38.1
Strategic,
operational
and
sustainability
goals
Taxation
Governance,
internal audit
and risk
management
Weighting
(%) Target
Actual results
Outcome
9.52 Execute plans to navigate the
changing global tax landscape
Details can be found on
page 110
9.52 Ensure effective systems of
internal control are operated
throughout the group’s
controlled entities
Details can be found on
page 40
Actual
payout
US$228 665
US$228 665
US$457 330
Actual
payout
US$114 272
US$114 272
Balance sheet
9.52 Take action to support our debt
Details can be found on
US$114 272
ratings responding to macro
impacts on the balance sheet
page 44
Sustainability:
Diversity and
inclusion
16.67 87% favourable response within
the finance function to the
question ’I feel respected at my
company‘ in the annual
engagement survey
72%; details can be found on
X
US$0
page 82
Sustainability:
Climate
sustainability
16.67 Reduce scope 1 and 2
emissions to zero at group
level3 by year-end FY23
Scope 1 and 2 emissions are
reduced to zero at group level3;
details can be found on page 100
61.90
US$200 097
US$542 913
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NASPERS
Integrated annual report 2023
151
Implementation of remuneration policy continued
LTI over FY23
No LTI awards were made in FY23. Instead, as described above, a short-term incentive for reducing the discount to net asset
value was introduced.
LTI awards continue to represent a significant portion of total compensation and are designed to incentivise the delivery of
sustainable longer-term growth and provide alignment with our shareholders.
In the table below which continues onto page 155, we have set out information on unvested LTIs, including awards that have
vested in FY23. Details of the group’s LTI schemes settlement are disclosed in note 38 on pages 135 and 136 of the consolidated
financial statements.
Overview of LTI awards for Bob van Dijk
Bob van
Dijk
Naspers
Perfor-
mance
Share Units
(PSUs)
Prosus
Perfor-
mance
Share Units
(PSUs)
Naspers
Global
Ecommerce
Share
Apprecia-
tion
Rights
(SARs)
Perfor-
mance
metric
Three-
year
cliff – TSR
Three-
year
cliff – TSR
Four-year
measure-
ment of
value
growth of
ecom-
merce
business
units
Main conditions of share plans
Number of unvested awards1
Value in US$
Award date
Vesting
date(s)
Expiry date
Opening
balance
1 April
2022
(unvested)
Strike
price of
option/
SAR
Awarded
during
the year
Vested
during
the year
Potential
gain of
awards
vested
during the
year at
vesting
date2
Fair value
of
unvested
awards
31 March
20233
Closing
balance
31 March
2023
(unvested)
09/09/2019
07/12/2022
21/09/2020
21/09/2023
21/06/2021
21/06/2024
Subtotal
26/08/2021
26/08/2024
n/a
n/a
n/a
n/a
–
–
–
–
24 527
48 302
27 796
–
(24 527)
–
6 898 864
–
–
–
–
–
48 302
27 796
– 17 875 339
–
5 143 296
100 625
–
(24 527)
76 098
6 898 864 23 018 635
26 993
–
–
26 993
–
2 104 787
Subtotal
26 993
–
–
26 993
–
2 104 787
15/08/2017
15/08/2022
15/08/2027
27.25
146 789
–
(146 789)
–
3 928 074
08/09/2017
08/09/2022
08/09/2027
27.60
35 055
–
(35 055)
–
895 305
25/06/2018
25/06/2022
25/06/2028
33.57
104 610
–
(104 610)
–
2 149 736
16/07/2019
16/07/2022
16/07/2029
36.70
109 208
–
(109 208)
–
1 842 339
–
–
–
–
16/07/2019
16/07/2023
16/07/2029
36.70
109 208
–
–
109 208
–
153 787
21/09/2020
21/09/2022
21/09/2030
41.98
62 571
–
(62 571)
–
451 763
21/09/2020
21/09/2023
21/09/2030
41.98
62 571
21/09/2020
21/09/2024
21/09/2030
41.98
62 572
–
–
–
–
62 571
62 572
21/06/2021
21/06/2022
21/06/2031
63.89
39 092
–
(39 092)
–
21/06/2021
21/06/2023
21/06/2031
63.89
39 092
21/06/2021
21/06/2024
21/06/2031
63.89
39 092
21/06/2021
21/06/2025
21/06/2031
63.89
39 092
–
–
–
–
–
–
39 092
39 092
39 092
–
–
–
–
–
–
–
–
–
–
–
–
–
Subtotal
848 952
– (497 325)
351 627
9 267 217
153 787
152
NASPERS
Integrated annual report 2023
Overview of LTI awards for Bob van Dijk continued
Main conditions of share plans
Number of unvested awards1
Value in US$
Bob van
Dijk
Naspers N
Share
Options
(SOs)
Perfor-
mance
metric
Four-year
share-
price
growth
Award date
Vesting
date(s)
Expiry date
Opening
balance
1 April
2022
(unvested)
Strike
price of
option/
SAR
Awarded
during
the year
Vested
during
the year
Potential
gain of
awards
vested
during the
year at
vesting
date2
Closing
balance
31 March
2023
(unvested)
25/06/2018
25/06/2022
25/06/2028 3 100 99
15 287
–
(15 287)
– 29 797 313
Fair value
of
unvested
awards
31 March
20233
–
–
16/07/2019
16/07/2022
16/07/2029 3 494.00
3 958
16/07/2019
16/07/2023
16/07/2029 3 494.00
3 961
21/09/2020
21/09/2022
21/09/2030 2 827.88
3 552
21/09/2020
21/09/2023
21/09/2030 2 827.88
3 552
21/09/2020
21/09/2024
21/09/2030 2 827.88
3 552
13/07/2021
13/07/2022
13/07/2031 2 819.37
2 316
13/07/2021
13/07/2023
13/07/2031 2 819.37
2 316
13/07/2021
13/07/2024
13/07/2031 2 819.37
2 316
13/07/2021
13/07/2025
13/07/2031 2 819.37
2 316
–
–
–
–
–
–
–
–
–
(3 958)
–
9 612 820
–
3 961
– 14 137 670
(3 552)
–
–
–
3 552
3 552
(2 316)
–
–
–
–
2 316
2 316
2 316
–
–
–
–
–
–
–
–
92 827
92 827
–
61 633
61 633
61 633
Subtotal
43 126
–
(25 113)
18 013 39 410 133 14 508 223
Prosus N
Share
Options
(SOs)
Four-year
share-
price
growth
26/08/2021
26/08/2022
26/08/2031
71.61
2 295
26/08/2021
26/08/2023
26/08/2031
71.61
2 295
26/08/2021
26/08/2024
26/08/2031
71.61
2 295
26/08/2021
26/08/2025
26/08/2031
71.61
2 298
Subtotal
Total
9 183
1 028 879
–
–
–
–
–
–
(2 295)
–
–
–
–
(2 295)
2 295
2 295
2 298
6 888
–
–
–
–
–
–
821
821
822
2 464
(549 260)
479 619 55 576 214 39 787 896
1 The aggregate number of vested but unexercised SARs and SOs for Bob is 6 299 177 (2022: 5 801 852) and 284 365 (2022: 1 088 957) respectively. The aggregate
cash-settled share-based payment liabilities of vested but unexercised SARs is included in note 38 of the consolidated financial statements on page 139. The
share-based payment reserve of vested but unexercised SOs is included in the aggregate retained earnings balance shown in note 38 of the consolidated financial
statements on page 141.
2 The potential gain vested in FY23 is calculated by taking the difference between the closing share price on vesting date and the offer price and multiplying that
difference by the number of SOs/SARs that vested in FY23. The value does not necessarily accrue to the individual. It is available to them should they have chosen
to exercise (buy and/or sell shares) on or after the date the SOs or SARs vested. The potential gain of the PSU award vested in FY23 reflects the actual pre-tax gain.
As part of the Prosus listing and capitalisation issue, the MIH Internet Holdings B.V. and Naspers Restricted Stock Plan trusts elected to receive Prosus shares. In line
with the capitalisation issue one (1) Prosus share is linked to each SO/PSU. The value of the Prosus share is included where relevant.
3 The fair value of unvested awards on 31 March 2023 is calculated by taking the difference between the closing share price on 31 March 2023 and the offer price
(if applicable) and multiplying that difference by the number of unvested SOs/SARs/PSUs as at 31 March 2023 and assuming 100% vesting for the PSU awards.
As part of the Prosus listing and capitalisation issue, the MIH Internet Holdings B.V. and Naspers Restricted Stock Plan trusts elected to receive Prosus shares. In line
with the capitalisation issue one (1) Prosus share is linked to each SO/PSU. The value of the Prosus share is included where relevant. The actual value accruing to
the executive will depend on the real value created over the time of the award.
NASPERS
Integrated annual report 2023
153
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Implementation of remuneration policy continued
Overview of LTI awards for Basil Sgourdos
Overview of LTI awards for Basil Sgourdos (continued)
Main conditions of share plans
Number of unvested awards1
Value in US$
Main conditions of share plans
Number of unvested awards1
Value in US$
Opening
balance
1 April
2022
(unvested)
Strike
price of
option/
SAR
Awarded
during
the year
Basil
Sgourdos
Naspers
Perfor-
mance
Share Units
(PSUs)
Prosus
Perfor-
mance
Share Units
(PSUs)
Naspers
Global
Ecommerce
Share
Apprecia-
tion
Rights
(SARs)
Perfor-
mance
metric
Three-
year
cliff
– TSR
Three-
year
cliff
– TSR
Four-
year
measure-
ment of
value
growth
of
ecom-
merce
business
units
Award
date
Vesting
date(s)
Expiry
date
09/09/2019 07/12/2022
21/09/2020 21/09/2023
21/06/2021 21/06/2024
Subtotal
26/08/2021 26/08/2024
–
–
–
–
Subtotal
–
–
–
–
12 718
28 623
16 472
57 813
15 995
15 995
15/08/2017 15/08/2022 15/08/2027
27.25
25 354
08/09/2017 08/09/2022 08/09/2027
27.60
21 020
25/06/2018 25/06/2022 25/06/2028
33.57
53 692
16/07/2019 16/07/2022 16/07/2029
36.70
56 626
16/07/2019 16/07/2023 16/07/2029
36.70
56 627
21/09/2020 21/09/2022 21/09/2030
41.98
37 079
21/09/2020 21/09/2023 21/09/2030
41.98
37 079
21/09/2020 21/09/2024 21/09/2030
41.98
37 080
21/06/2021 21/06/2022 21/06/2031
63.89
23 165
21/06/2021 21/06/2023 21/06/2031
63.89
23 165
21/06/2021 21/06/2024 21/06/2031
63.89
23 165
21/06/2021 21/06/2025 21/06/2031
63.89
23 166
Potential
gain of
awards
vested
during the
year at
vesting
date2
Fair value
of
unvested
awards
31 March
20233
Closing
balance
31 March
2023
(unvested)
–
3 577 212
–
Vested
during
the year
(12 718)
–
–
28 623
16 472
– 10 592 643
–
3 047 934
(12 718)
45 095
3 577 212 13 640 576
–
15 995
–
1 247 215
–
15 995
–
1 247 215
(25 354)
(21 020)
(53 692)
(56 626)
–
–
678 473
536 851
–
1 103 371
–
955 281
–
–
–
–
–
56 627
–
79 742
(37 079)
–
267 710
–
–
37 079
37 080
(23 165)
–
–
–
–
23 165
23 165
23 166
–
–
–
–
–
–
–
–
–
–
–
–
–
Basil
Sgourdos
Naspers N
Share
Options
(SOs)
Perfor-
mance
metric
Four-year
share-
price
growth
Prosus
Share
Options
(SOs)
Four-year
share-
price
growth
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Award
date
Vesting
date(s)
Expiry
date
Opening
balance
1 April
2022
(unvested)
Strike
price of
option/
SAR
Awarded
during the
year
Vested
during
the year
Potential
gain of
awards
vested
during the
year at
vesting
date2
Fair value
of
unvested
awards
31 March
20233
Closing
balance
31 March
2023
(unvested)
25/06/2018 25/06/2022 25/06/2028
3 100.99
8 277
16/07/2019 16/07/2022 16/07/2029
3 494.00
2 052
16/07/2019 16/07/2023 16/07/2029
3 494.00
2 055
21/09/2020 21/09/2022 21/09/2030
2 827.88
2 105
21/09/2020 21/09/2023 21/09/2030
2 827.88
2 105
21/09/2020 21/09/2024 21/09/2030
2 827.88
2 105
13/07/2021 13/07/2022 13/07/2031
2 819.37
1 372
13/07/2021 13/07/2023 13/07/2031
2 819.37
1 372
13/07/2021 13/07/2024 13/07/2031
2 819.37
1 372
13/07/2021 13/07/2025 13/07/2031
2 819.37
1 373
Subtotal
24 188
26/08/2021 26/08/2022 26/08/2031
71.61
1 360
26/08/2021 26/08/2023 26/08/2031
71.61
1 360
26/08/2021 26/08/2024 26/08/2031
71.61
1 360
26/08/2021 26/08/2025 26/08/2031
71.61
1 362
5 442
Subtotal
Total
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(8 277)
(2 052)
– 16 133 470
–
4 983 706
–
–
–
2 055
–
7 334 742
(2 105)
–
–
–
2 105
2 105
(1 372)
–
–
–
–
1 372
1 372
1 373
–
–
–
–
–
–
–
–
55 011
55 011
–
36 511
36 511
36 538
(13 806)
10 382 21 117 176
7 554 324
(1 360)
–
–
–
–
1 360
1 360
1 362
(1 360)
4 082
–
–
–
–
–
–
486
486
487
1 459
520 656
–
(244 820)
275 836 28 236 074 22 523 316
Subtotal
417 218
–
(216 936)
200 282
3 541 686
79 742
1 The aggregate number of vested but unexercised SARs and SOs for Basil is 759 259 (2022: 542 323) and 92 201 (2022: 104 395) respectively. The aggregate
cash-settled share-based payment liabilities of vested but unexercised SARs is included in note 38 of the consolidated financial statements on page 139.
The share-based payment reserve of vested but unexercised SOs is included in the aggregate retained earnings balance shown in note 38 of the consolidated
financial statements on page 141.
2 The potential gain vested in FY23 is calculated by taking the difference between the closing share price on vesting date and the offer price and multiplying that
difference by the number of SOs/SARs that vested in FY23. The potential gain of the PSU award vested in FY23 reflects the actual pre-tax gain. The value does not
necessarily accrue to the individual. It is available to them should they have chosen to exercise (buy and/or sell shares) on or after the date the SOs or SARs vested.
As part of the Prosus listing and capitalisation issue, the MIH Internet Holdings B.V. and Naspers Restricted Stock Plan trusts elected to receive Prosus shares. In line
with the capitalisation issue one (1) Prosus share is linked to each SO/PSU. The value of the Prosus share is included where relevant.
3 The fair value of unvested awards on 31 March 2023 is calculated by taking the difference between the closing share price on 31 March 2023 and the offer price
(if applicable) and multiplying that difference by the number of unvested SOs/SARs/PSUs as at 31 March 2023 and assuming 100% vesting for the PSU awards. As
part of the Prosus listing and capitalisation issue, the MIH Internet Holdings B.V. and Naspers Restricted Stock Plan trusts elected to receive Prosus shares. In line
with the capitalisation issue one (1) Prosus share is linked to each SO/PSU. The value of the Prosus share is included where relevant. The actual value accruing to
the executive will depend on the real value created over the time of the award.
154
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Integrated annual report 2023
NASPERS
Integrated annual report 2023
155
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Implementation of remuneration policy continued
The balance of the executive directors’ unvested LTIs as at 31 March 2023 (based on potential profit using
share prices on 31 March 2023)
Bob van Dijk (%)
Basil Sgourdos (%)
37
5
Naspers PSUs
Prosus PSUs
Naspers SOs
Prosus SOs
Ecommerce SARs
58
58%
5%
37%
0%
0%
34
5
Naspers PSUs
Prosus PSUs
Naspers SOs
Prosus SOs
Ecommerce SARs
61
61%
5%
34%
0%
0%
Shares purchased in the market
Since 1 April 2018, to avoid shareholder dilution as a result of
employee LTIs, the group has been purchasing Naspers and
Prosus shares on JSE/Euronext for the purpose of issuing new
Naspers SOs, Naspers PSUs, Naspers RSUs, Prosus SOs, Prosus
PSUs and Prosus RSUs to employees and settling gains made
on all share-based incentive schemes (prior to 31 March 2020).
In FY23, the group purchased Naspers ordinary shares to the
value of US$14m (FY22: US$38m) and Prosus ordinary shares N
to the value of US$210m (FY22: US$182m) in the market, totalling
US$224m (FY22: US$220m).
The table below sets out the details around Prosus shares purchased in the market through the Prosus N.V. Share Award and
Option Plan Trust during FY23 and FY22 in respect of grants made in the Prosus N.V. Share Award Plan and Prosus N.V. Share
Option Plan1:
2023
Number of
shares
Purchase
price
(US$)2
Average
market price
range
Number of
shares
2022
Purchase
price
(US$)2
Prosus N.V. Share Award and
Option Plan Trust1
3 174 063
210 373 660
2 064 211
182 002 007
€58.21 and
€71.71
R1 007.90 and
R1 330.68
Average
purchase
price
range
€42.44 and
€84.58
R1 220.09 and
R1 434.74
Executive directors’ LTI vested and exercised in FY23
Dilutive impact of group LTI schemes
The board has determined that no more than 5% of the current
N ordinary share capital may be used for share-based
incentive schemes.
LTI costs
LTIs across the group account for -2.9% of total staff costs, and
-0.6% of overall group costs, for example, the cost of providing
services and sale of goods, selling, general and
administration expenses. The LTI costs decreased due to
changes in valuation assumptions, including share prices and
volatility, as well as the impact of allocations made and
vesting of options. Further details can be found in note 38 on
page 137 of the consolidated financial statements on our
website at www.naspers.com.
Statement of compliance
Termination payments
No termination payments were made to executive and
non-executive directors on termination of employment or office
in FY23.
Malus and clawbacks
Malus and clawback provisions apply to the STI and LTI
awarded to executive directors and direct reports of the CEO.
In FY23, no malus or clawback was applied to any
remuneration of executive directors and direct reports of
the CEO.
CEO shareholding requirement
The CEO met his shareholding requirement of rebalancing his
current holding of 10 times annual salary in Naspers shares
by the end of FY23 while maintaining an overall combined
direct and indirect holding in Naspers and Prosus shares of
10 times annual salary.
PSUs vested
In FY20, Bob van Dijk and Basil Sgourdos were awarded
24 527 and 12 718 Naspers PSUs respectively.
The level of achievement relative to the performance
condition, at the end of the three-year performance period,
was determined above median, at the 57th percentile; this
resulted in a 128% vesting. The total number of Naspers PSU
that vested was 31 395 for Bob and 16 279 for Basil.
The achievement of the performance condition was assessed
by the human resources and remuneration committee and
validated by the valuations subcommittee, as per the
valuations process described on page 144.
SOs exercised
Bob van Dijk and Basil Sgourdos exercised Naspers SOs in
the MIH Internet Holdings B.V. Share Trust; Basil disposed of
the entirety of the award and Bob disposed of 675 415
Naspers N ordinary shares and the remaining shares were
transferred into his own name.
Details of the above transactions have been summarised below:
Bob van Dijk –
PSUs
Date
vested
Number
of
PSUs
Gross gain
(pre-tax)
US$1
Naspers PSUs
2022/12/07
31 395
6 898 864
Bob van Dijk –
SOs
Date
exercised
Number
of
SOs
Gross gain
(pre-tax)
US$1
Naspers N SOs
2022/09/02
832 000 119 362 285
Bob van Dijk – total
126 261 149
Basil Sgourdos –
PSUs
Date
vested
Number
of
PSUs
Gross gain
(pre-tax)
US$1
Naspers PSUs
2022/12/07
16 279
3 577 212
Basil Sgourdos –
SOs
Date
exercised
Number
of
SOs
Gross gain
(pre-tax)
US$1
Naspers N SOs
2023/01/25
27 360
6 590 054
Basil Sgourdos – total
10 167 266
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1 The Prosus N.V. Share Award Plan is used to grant Prosus RSUs to employees of the group (executive directors are not eligible to receive RSUs) and PSUs to
executive directors and eligible senior management. The Prosus N.V. Share Option Plan is used to grant Prosus Options to executive directors and eligible senior
management. Shares are purchased on Euronext and Johannesburg Stock Exchange for non-South African and South African employees respectively.
2 Purchase price in euro converted to US dollar by using the exchange rate on date of purchase.
1 As part of the Prosus listing, one Prosus ordinary share N is linked to each SO/PSU. The gain on the linked Prosus ordinary share N is included above.
o
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156
NASPERS
Integrated annual report 2023
NASPERS
Integrated annual report 2023
157
Implementation of remuneration policy continued
Looking forward to FY24
Having not awarded salary increases in FY21 and FY23, the committee has decided to award a 5% salary increase to the CEO
and CFO. LTI awards will be made at similar levels to FY22 (the CEO and CFO did not receive LTI awards in FY23) to incentivise
long-term value creation, growth and shareholder alignment.
LTI awards to be made in FY24
LTI awards comprise a significant portion of total executive compensation and are designed to incentivise the delivery of
sustainable longer-term growth and provide alignment with our shareholders. The entirety of our executives’ LTI is determined by
the performance of the company and growth in the valuation of the underlying assets and, as such, is deemed ‘at risk’. We
continue to assess and adjust the relevance in terms of size, scale and sector of the peer group for prospective PSU awards. For
the FY24 PSU award we have removed Qurate and added Mercado Libre and Sea Limited. The FY24 peer group is: Adevinta,
Adyen, Alphabet, Amazon, Auto Trader, Booking Holdings, Deliveroo, DoorDash, eBay, Expedia, IAC, Just Eat Takeaway.com,
Mercado Libre, Meta, Netflix, Ocado Group, PayPal, Sea Limited, Snap, Square Inc., Wayfair, Zalando, Zillow Group.
Approximate balance of the unvested LTIs, post the FY24 allocation
Bob van Dijk (%)
2
8
Basil Sgourdos (%)
2
8
28
26
47
47%
15%
28%
2%
8%
49
49%
15%
26%
2%
8%
15
Naspers PSUs
Prosus PSUs
Naspers SOs
Prosus SOs
Ecommerce SARs
Variable remuneration
Fixed
remunerations1
Standard
STI2
LTI4
PSUs3
SARs
SOs
Pension
Other
benefits5
Total
remuneration6
Proportion
of fixed and
variable
remuneration
1 361
1 162
1 361
8 025
4 013
1 338
1 162
4 428
2 214
738
89
91
47
18
16 235
9 814
8%/92%
12%/88%
Variable remuneration
Fixed
remunerations1
Standard
STI2
LTI4
PSUs3
SARs
SOs
Pension
Other
benefits5
Total
remuneration6
Proportion
of fixed and
variable
remuneration
1 476
1 260
1 476
8 700
4 350
1 450
1 260
4 800
2 400
800
97
99
51
20
17 600
10 639
8%/92%
12%/88%
15
Naspers PSUs
Prosus PSUs
Naspers SOs
Prosus SOs
Ecommerce SARs
FY24 single-figure table
€’000
Executive director
Bob van Dijk, CEO
Basil Sgourdos, CFO
US$’000
Executive director
Bob van Dijk, CEO
Basil Sgourdos, CFO
1 The executive directors received a 5% increase in base salary, effective from 1 April 2023.
2 This is the at-target and also maximum STI as a percentage to base salary. FY24 STI goals are shown on page 159 of the remuneration report.
3 Represents the grant date fair value of awards to be made during FY24 assuming on-target vesting for PSUs. The actual value accruing to the executive will depend
on the real value created over the time of the award. The figure is based on indicative values and may therefore differ from the final fair value granted.
4 The grant of the FY24 PSU and SO awards will be partly settled in Naspers shares (43%) and partly in Prosus shares (57%), aligned with the free-float ownership in
Naspers and Prosus.
5 Medical insurance, life and disability insurance.
6 Executive directors are executive directors of both Naspers and Prosus. Their remuneration as executive directors of these entities is split 10/90 between Naspers
and Prosus.
158
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Integrated annual report 2023
Discount-linked STI
The discount-linked STI awarded in FY23 has been deemed to be achieved, see page 148. A similar award will not be made in
FY24.
FY24 STI goals
In the table below, we disclose FY24 STI goals for Bob van Dijk and Basil Sgourdos.
All financial, strategic, operational and sustainability goals are measurable and validated.
The committee undertakes a thorough assessment to ensure targets are sufficiently stretched in the context of potential
remuneration delivered. Targets will be disclosed in the FY24 remuneration report.
Bob van Dijk
Target and maximum STI opportunity: 100% base salary
Group financial goals
Core headline earnings
(including Tencent)
Free cash flow to equity
Ecommerce financials
Strategic, operational and
sustainability goals
Sustainability: People
Sustainability: Climate
Weighting
(%)
Description
20
Achieve core headline earnings at target, including Tencent
20
10
Achieve free cash to equity inflow at target
Deliver organic topline growth at target, excluding Tencent
40 Manage trading loss at target
Weighting
(%) Description
5
Improve employee engagement
5 Majority-owned businesses to measure and document material
scope 3 emissions
Basil Sgourdos
Target and maximum STI opportunity: 100% of base salary
Maximum payout
€272 245
€272 245
€136 123
€544 491
Maximum payout
€68 061
€68 061
Maximum payout
Group financial goals
Core headline earnings
(including Tencent)
Free cash flow to equity
Weighting
(%)
Description
30
Achieve core headline earnings at target, including Tencent
US$378 107
10
Achieve free cash to equity inflow at target
US$126 036
Strategic, operational and
sustainability goals
Weighting
(%) Description
Taxation
Governance, internal audit and
risk management
5
5
Execute plans to navigate the changing global tax landscape
Ensure that effective systems of internal control are operated
throughout the group’s controlled entities
Maximum payout
US$63 018
US$63 018
Balance sheet
10 Maintain our debt ratings and deliver appropriate funding structures
US$126 036
Holding company discount
Sustainability: People
Sustainability: Climate
for M&A transactions the group considers
30
Sustain the open-ended buyback and identify ways to simplify group
structure
5
Improve employee engagement
5 Majority-owned businesses to measure and document material
scope 3 emissions
US$378 107
US$63 018
US$63 018
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NASPERS
Integrated annual report 2023
159
Implementation of remuneration policy continued
Non-executive directors
Non-executive directors’ fees
Given the global scale and complexity of the businesses we operate and in which we have interests, it is important that we can
attract and retain the best globally orientated board members. The committee conducts a regular benchmarking exercise to
ascertain whether fees for non-executive directors are competitive, fair and reasonable. The committee is informed by the external
market when reviewing the fee structure and levels for our non-executive directors. This includes primarily market fee levels for the
Naspers and Prosus industry peers internationally, as well as fee levels observed in the top 10 AEX and JSE companies.
At the August 2022 annual general meeting, shareholders approved a deferral of the FY23 fee increase to FY24, based on a
recent review, the board is proposing a 5% fee increase for FY25.
Non-executive directors’ fee development
Board
Committees
Trustees of group share schemes/other personnel funds
All members: Daily fees when travelling to and
attending meetings outside home country
2020
(%)
5
5
5
0
2021
(%)
0
0
0
0
2023
(%)
(deferred
to 2024)
0
0
0
0
2022
(%)
5
5
5
0
2024
(%)
5
5
5
0
2025
(proposed)
5
5
5
0
Note: Following the listing of Prosus N.V. on Euronext Amsterdam in September 2019, Naspers non-executive directors serve on the boards of both companies. Given
these dual responsibilities, fees are split between Naspers and Prosus on a 30/70 basis. Non-executive directors do not receive variable remuneration.
No additional fees are paid to board members serving on the projects committee or on the valuations subcommittee of the
human resources and remuneration committee. Non-executive directors do not receive any short or long-term incentives or
equity-based compensation.
Non-executive directors serve on the boards of both Naspers and Prosus and receive no additional compensation for their dual
responsibilities to Naspers and Prosus. Fees are split between Naspers and Prosus on a 30/70 basis, pro-rated from the date of
listing of Prosus. The split was determined based on the underlying assets and the amount of time required to ensure that
sufficient time is allocated to assume the dual responsibilities.
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’ fees as approved at the annual general meetings1
In US$ (unless otherwise stated)
Chair2
Member
All members: Daily fees
when travelling to and
attending meetings outside
home country
Committees
Audit committee:
Risk committee:
Human resources and
remuneration committee:
Nominations committee:
Sustainability committee:
Other (ZAR)
Trustee of group
share schemes/other
personnel funds
Chair
Member
Chair
Member
Chair
Member
Chair
Member
Chair
Member
FY22
(total proposed fee
payable by Naspers
and Prosus)
523 243
209 297
3 500
FY23
(total proposed fee
payable by Naspers
and Prosus)
523 243
209 297
3 500
FY23
(amount payable
by Prosus)
366 270
146 508
2 450
FY23
(amount payable
by Naspers
156 973
62 789
1 050
128 915
51 566
76 573
30 629
90 590
36 236
48 825
19 530
67 013
26 805
56 448
128 915
51 566
76 573
30 629
90 590
36 236
48 825
19 530
67 013
26 805
56 448
90 241
36 096
53 601
21 440
63 413
25 365
34 178
13 671
46 909
18 764
39 514
38 675
15 470
22 972
9 189
27 177
10 871
14 648
5 859
20 104
8 042
16 934
1 Following the listing of Prosus on Euronext Amsterdam, Naspers non-executive directors serve on the boards of both Naspers and Prosus. As a result of these dual
responsibilities, proposed fees will be split between Naspers and Prosus on a 30/70 basis.
2 The chair of Naspers does not receive additional remuneration for attending meetings or being a member of or chairing any committee of the board. He receives
no compensation for serving on the board of Tencent.
160
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Integrated annual report 2023
Non-executive directors’ fees
US$’000
Non-executives
JP Bekker3
HJ du Toit4
S Dubey5
CL Enenstein
M Girotra
RCC Jafta
AGZ Kemna6
FLN Letele
D Meyer
R Oliveira de Lima
SJZ Pacak
MR Sorour7
JDT Stofberg
Y Xu
Total
US$’000
Non-executives
JP Bekker3
EM Choi8
HJ du Toit4
S Dubey5
CL Enenstein
M Girotra
RCC Jafta
AGZ Kemna6
FLN Letele
D Meyer
R Oliveira de Lima
SJZ Pacak
MR Sorour7
JDT Stofberg
BJ van der Ross9
Y Xu
Total
Directors’ fees1
2023
Committees and trusts
Other fees2
Total
Paid by
company
576
–
174
269
251
265
258
262
265
272
258
258
262
255
3 625
Paid by
subsidiary
22
–
–
–
–
65
–
–
–
–
–
–
–
–
87
Paid by
company
–
–
26
110
52
106
82
27
67
56
205
–
27
–
758
Paid by
subsidiary
7
–
–
–
–
37
–
–
–
–
–
–
–
–
44
Paid by
company
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Paid by
subsidiary
–
–
–
50
–
–
–
–
–
50
–
120
–
–
220
605
–
200
429
303
473
340
289
332
378
463
378
289
255
4 734
Directors’ fees1
2022
Committees and trusts
Other fees2
Total
Paid by
company
558
109
–
–
244
234
244
160
244
241
244
244
244
244
244
244
3 498
Paid by
subsidiary
24
–
–
–
–
–
72
–
–
–
–
–
139
–
–
–
235
Paid by
company
–
27
–
–
110
52
127
54
27
67
56
205
–
27
27
–
779
Paid by
subsidiary
8
–
–
–
–
–
42
–
–
–
–
–
–
–
–
–
50
Paid by
company
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Paid by
subsidiary
–
–
–
–
50
–
–
–
–
–
50
–
120
–
–
–
220
590
136
–
–
404
286
485
214
271
308
350
449
503
271
271
244
4 782
1 Following the listing of Prosus, non-executive directors serve on the boards of both Naspers and Prosus. As a result of these dual responsibilities,
fees were split between Naspers and Prosus on a 30/70 basis.
2 Compensation for assignments.
3 Koos Bekker elected to donate the after-tax rand equivalent of all his directors’ fees to education. This year the recipients will be two schools in Cape Town, the
Jan van Riebeeck Primary and Secondary schools.
4 Hendrik du Toit elected not to receive directors’ fees.
5 Appointed as a director of Prosus on 24 August 2022 and Naspers on 1 April 2022.
6 Appointed with effect from 24 August 2021.
7 Mark Sorour received US$12 425 (2022: 14 227.13) from MIH Holdings Proprietary Limited for the period 1 April 2022 to 31 March 2023. This payment relates to
the increased cost of medical aid for retired members of the MMED medical aid scheme after the unbundling of MultiChoice Group Limited. Originally, it was
noted that the company will provide an annual allowance to cover the difference in cost for retired scheme members. This is not disclosed in the above table.
8 Emilie Choi resigned with effect from 26 August 2021.
9 Retired with effect from 1 April 2022.
NASPERS
Integrated annual report 2023
161
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Implementation of remuneration policy continued
General notes
Directors’ fees include fees for services as directors, where
appropriate, of Naspers and Media24 Proprietary 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 the sustainability committee. Non-executive
directors are subject to regulations on appointment and
rotation in terms of Naspers’ memorandum of incorporation,
Prosus’ articles of association, Dutch legal requirements and
the South African Companies Act.
The group arranges for, and pays, directors and officers
liability insurance for the directors and officers of the group.
As at the date of this report, the group has not provided any
personal loans, advances or guarantees to the executive and
non-executive directors.
Koos Bekker and Cobus Stofberg each have an indirect 25%
interest in Wheatfields 221 Proprietary Limited, which controls
168 605 Naspers Beleggings (RF) Limited ordinary shares,
16 860 500 Keeromstraat 30 Beleggings (RF) Limited ordinary
shares, 179 988 (2022: 179 988) Naspers A shares and
834 540 (2022: 834 540) Prosus A1 shares.
Compliance
There were no deviations from the executive and non-executive
directors’ remuneration policy in FY23.
Executive and non-executive directors’ interest in Naspers shares
The non-executive directors of Naspers had the following interests in Naspers A1 ordinary shares on 31 March 2023 and
31 March 2022:
Directors
JDT Stofberg
SJZ Pacak
Total
Directors
JDT Stofberg
SJZ Pacak
Total
31 March 2023
Naspers A1 ordinary shares
Beneficial
Direct
Indirect
–
–
–
175
105
280
31 March 20221
Naspers A1 ordinary shares
Beneficial
Direct
Indirect
–
–
–
175
105
280
Total
175
105
280
Total
175
105
280
The executive and non-executive directors had the following interests in Naspers N ordinary shares on 31 March 2023 and
31 March 2022:
Directors
JP Bekker
HJ du Toit
S Dubey2
CL Enenstein
M Girotra
RCC Jafta
AGZ Kemna
FLN Letele
D Meyer
R Oliveira de Lima
SJZ Pacak3
V Sgourdos4, 5
MR Sorour6
JDT Stofberg
B van Dijk7, 8
BJ van der Ross9
Y Xu
Total
31 March 2023
Naspers N ordinary shares
Beneficial
Indirect1
1 687 887
Total
1 687 887
–
–
415
–
–
–
–
–
–
28 800
90 841
159 870
291 888
282 070
–
–
1 265
–
415
–
–
–
2 604
–
–
142 786
116 363
161 219
372 916
457 306
–
–
Direct
–
1 265
–
–
–
–
–
2 604
–
–
113 986
25 522
1 349
81 028
175 236
–
–
400 990
2 541 771
2 942 761
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1 As part of implementing the share exchange offer approved by shareholders on 9 July 2021, additional ordinary shares A1 were issued to
holders of ordinary shares A1 on a pro rata basis on 16 August 2021.
1 Naspers SOs that have been released (vested), but not yet been exercised, are included in the indirect column: Bob van Dijk: 282 070 (2022: 1 088 957).
Basil Sgourdos: 90 841 (2022: 104 395). Steve Pacak: 0 (2022: 54 000). Mark Sorour: 159 428 (2022: 166 194).
2 Appointed as a director of Prosus on 24 August 2022 and Naspers on 1 April 2022.
3 On 8 July 2022, Steve Pacak exercised 54 000 share options and the linked Prosus N.V. and MultiChoice Group Limited share options. These share options relate to
54 000 Naspers N ordinary share options, awarded on 7 September 2012.
4 On 25 January 2023, Basil Sgourdos exercised 27 360 share options and the linked Prosus N.V. share options. These share options related to 27 360 Naspers share
options awarded on 11 July 2013.
5 On 7 December 2022, Basil Sgourdos exercised 16 279 Naspers PSUs and the linked Prosus PSUs awarded to him on 9 September 2019. He disposed of
2 451 Naspers N ordinary shares to cover taxes and other related costs on market and took delivery of the remaining 13 828 Naspers N ordinary shares.
6 On 29 June 2022, Mark Sorour exercised 6 766 share options. These share options relate to 1 827 share options linked to the listing of Prosus and 4 939 share
options awarded on 2 July 2012.
7 On 7 December 2022, Bob van Dijk exercised 31 395 Naspers PSUs and the linked Prosus PSUs awarded to him on 9 September 2019. He disposed of the entirety
of the award on market.
8 On 29 August, 30 August and 31 August 2022, Bob van Dijk exercised 832 000 Naspers share options and the linked Prosus share options. The share options were
awarded on 28 March 2014. 675 415 Naspers N ordinary shares were disposed of to cover taxes and other related costs. The remaining 156 585 Naspers N
ordinary shares were transferred to his name.
9 Resigned as a director of Prosus and Naspers on 1 April 2022.
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Implementation of remuneration policy continued
Additional information
Directors
JP Bekker2
HJ du Toit2
S Dubey3
CL Enenstein
M Girotra
RCC Jafta
AGZ Kemna4
FLN Letele
D Meyer
R Oliveira de Lima
SJZ Pacak2
V Sgourdos2, 5
MR Sorour2
JDT Stofberg2
BJ van der Ross2, 6
B van Dijk2
Y Xu
Total
31 March 2022
Naspers N ordinary shares
Beneficial
Indirect1
1 687 887
Total
1 687 887
–
–
415
–
–
–
–
–
–
28 800
104 395
166 636
291 888
295
1 088 957
–
3 423 273
1 265
–
415
–
–
–
2 604
–
–
196 786
116 089
167 985
372 916
1 213
1 107 608
–
3 654 768
Direct
–
1 265
–
–
–
–
–
2 604
–
–
113 986
11 694
1 349
81 028
918
18 651
–
231 495
1 Naspers SOs that have been released (vested), but have not yet been exercised, are included in the indirect column:
Bob van Dijk: 1 088 957 (2021: 1 003 928). Basil Sgourdos: 104 395 (2021: 98 410). Mark Sorour: 166 194 (2021: 158 853). Steve Pacak: 54 000 (2021: 54 000).
2 Each of these directors participated in the share exchange which was approved by Prosus shareholders on 9 July 2021 and concluded on 16 August 2021. As part
of this transaction, the directors traded a portion of their Naspers N ordinary shares in exchange for Prosus ordinary shares N.
3 Appointed as a director on 1 April 2022.
4 Appointed as a director on 15 April 2021.
5 On 31 January 2022, Basil Sgourdos had exercised 11 124 Naspers and Prosus options and decided to dispose of the Naspers N ordinary shares he received and
to retain the Prosus ordinary shares N. The full net gain after tax on disposal of these shares was reinvested back into the group in the form of Prosus ordinary
shares N when, on 1 March 2022, he purchased 20 000 Prosus ordinary shares N at a volume-weighted average value per share of €56.3933.
6 Resigned as a director on 1 April 2022.
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Graphic overview of our LTI plans
PSU How does a performance share unit (PSU) work?
Achievement of
performance condition
Continued
employment
Award made:
Performance
conditions and
vesting period
specified at
grant
Date
3rd
anniversary
of grant
(year three)
If yes
The vesting of a PSU is determined not just by time. In order for an award to vest, certain business performance conditions must also be met.
If the threshold level of performance is not achieved, no shares will be awarded to the participant.
SAR How does a share appreciation right (SAR) work?
Award:
10 000 SARs
at a value of
US$10 per
SAR
Percentage
of SARs vesting
25%
Date
1st
anniversary
of grant
(year one)
Total number
of SARs vested
2 500
25%
2nd
anniversary
of grant
(year two)
5 000
25%
3rd
anniversary
of grant
(year three)
7 500
According to
number of
shares
released
to participant
(0% to 200% of
awarded
PSUs)
25%
4th
anniversary
of grant
(year four)
10 000
After two years the employee, assuming they didn’t exercise their first 2 500 after year one, may exercise 5 000 of their 10 000 SARs. If the value of an
SAR at this point has increased to US$14, the employee made a gain of US$4 per SAR, giving the employee a total gain of US$20 000 (5 000 SARs x
US$4 gain per SAR). So, if exercised, the employee would be awarded a value of US$20 000. If there is no increase in share value there is no gain
to the participant.
SO How does a stock option (SO) work?
Offered:
400 SOs, and
the closing
price on the
grant date is
US$100 per
scheme share
Share option
vestings
25%
Date
1st
anniversary
of grant
(year one)
Total number
of SOs vested
100
25%
2nd
anniversary
of grant
(year two)
200
25%
3rd
anniversary
of grant
(year three)
300
25%
4th
anniversary
of grant
(year four)
400
Let’s say that two years after the grant date, the employee chooses to exercise and pay for 200 scheme shares, ie US$100 x 200 = US$20 000. If the
market price of a scheme share has increased to say US$120, and the employee decides to sell them, that is a gain of US$20 per share. This means
the employee shares in the success of the group by earning a benefit of US$4 000, ie US$20 x 200 scheme shares. If there is no increase in share value
there is no gain to the participant.
RSU How does a restricted share unit (RSU) work?
Awarded:
200 RSUs
RSU
vestings
Date
25%
1st
anniversary
of grant
(year one)
Total number
of RSUs vested
50
25%
2nd
anniversary
of grant
(year two)
100
25%
3rd
anniversary
of grant
(year three)
150
25%
4th
anniversary
of grant
(year four)
200
Employee is awarded 200 RSUs on grant date. On each of the vesting dates they will automatically receive 50 shares. Let’s assume that on the first
vesting date the price is US$100 per share, the employee would then receive a benefit, at that point, to the value of US$5 000, ie 50 shares times
an assumed US$100 per share.
Note: RSUs are not available to the CEO, CFO, or other senior executives across the group.
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About this report
LTI policies
LTI scheme limits
Date and price of SARs, SOs and PSUs/RSUs
Our LTI policy does not allow for backdating LTI awards, or for
the offer price to be adjusted to bring underwater SARs or
SOs ‘into the money’. There is no strike price for a PSU or an
RSU; these are full-value shares and PSUs vest only if the
performance conditions determined at grant are achieved.
Offer prices may be adjusted under the rules of the scheme to
take account of material structural changes to the group, for
example, when Prosus was listed in 2019, Naspers
shareholders and employees holding Naspers SOs received
Prosus capitalisation/Naspers N capitalisation shares
(depending on which share trust they participated in),
linked to each option.
LTI dividend policy
Employees of the Naspers group holding unvested PSUs,
RSUs or SOs do not receive ordinary dividends. On vesting,
these participants are treated like all other shareholders
with respect to ordinary dividends.
We place limits on how much of the capitalisation (cap) table
is available for employee compensation. In general, no more
than 5% of the Naspers cap table can be used for unvested
employee compensation. For SARs plans that relate to our
unlisted assets, no more than 15% of the cap table can be
used for unvested employee compensation. Depending on the
life stage of the business, the scheme limit can be lower.
When the business takes funding from Naspers, the SAR
scheme is diluted as additional shares are issued.
Offer price
Also called grant price, strike price or purchase price. The
price of the share on the date the SAR or SO was granted,
at which the participant can buy the share at a later date
(or in the case of a SAR, used to calculate a gain).
Exercise price
The price of the share at the time the participant chooses to
exercise their SARs or SOs. The value gain to the participant is
calculated by subtracting offer price from exercise price.
Prudent approach
Offer date
Vesting periods are conservative relative to the companies
with which we compete for talent. Our LTI plans typically vest
over four years, with equal tranches vesting annually. The PSU
plan has a three-year cliff-vesting. Across the consumer
internet sector, a three or four-year vesting period is common,
with grants often vesting monthly after the first year.
In FY23 we continued to broaden the use of RSUs as an
effective LTI for many of our employees. RSUs are a common
and widely spread LTI vehicle across the competitive consumer
technology sector. For our senior roles (excluding senior
executives), RSUs will continue to be complemented with
SAR allocations on our unlisted assets, aligning the incentive
to the performance delivery and value creation in the
underlying business segments. With that, RSUs do not come in
addition to SARs, but are part of the blend of LTIs offered.
Note that RSUs are not available to the CEO, CFO, or other
senior executives across the group. In an exceptional case,
RSUs may be applied for a new hire, when necessary to
‘buy out’ remuneration forfeited on joining the company.
Our SO plans typically have a 10-year expiry term. This is a
common term length across the consumer internet sector
where early-stage businesses take longer to reach maturity
and create shareholder value. Since 1 April 2022, we have
limited the expiry period of our SARs plans to six years.
Also called grant date. The date on which an LTI is offered to
the participant, giving that participant the right to buy or
receive shares at a future date.
Performance management
Pay for performance is one of the pillars of our reward
philosophy. Personal performance and business performance
are the determining factors in whether an individual receives a
base salary increase, an annual performance-related incentive
payout and/or an LTI in the form of SARs, PSUs (for executives
only), RSUs (not for executives) or SOs.
Personal goals are determined 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
personal performance goals. These goals, if achieved, drive
the accomplishment of the financial and operating plan of
the business.
Managers engage continuously with their teams throughout
the financial year to ensure 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 paying an
annual performance-related STI. While we do not force-rank
performance scores, we do expect that any performance-
related incentive payments reflect overall performance where
appropriate. Individuals who have performed well against
their performance-related incentive goals are eligible to be
considered for an LTI grant and pay increase. Only strong
performers are considered for LTI awards.
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This integrated annual report assesses our performance for
the financial year ended 31 March 2023. We aim to provide
a view of our progress and impact on society.
Reporting
We measure our performance by evaluating how we
create value for our key stakeholders. We also report on the
11 material matters identified by our stakeholders in our first
materiality assessment as well as progress made against our
strategy. We regularly measure returns on invested capital. We
understand the risks we take and manage these to minimise
their impact on our business and results.
This way of telling a comprehensive, connected story fits well
with our holistic view of value and our focus on creating
sustainable value for long-term good.
Scope and boundary of reporting
Financial and non-financial reporting
This report extends beyond financial reporting. It reflects on
non-financial performance, opportunities, risks and outcomes
attributable to or associated with key stakeholders who have
a significant influence on our ability to create value.
Our subsidiaries, associates and investees are required to
comply with applicable law and regulation. The group also
encourages its associates and investees to adopt appropriate
governance standards (for example, codes of business ethics
and conduct, and policies relating to anti-bribery and
anti-corruption, competition compliance, privacy and sanctions
and export controls).
It includes the strategy and financial performance of Naspers
and its subsidiaries, joint ventures and associates (the group).
The scope of reporting on non-financial data (GHG emissions),
is included as an appendix ‘Boundaries and scope of our
GHG accounting’ to this report. Group reporting standards are
continually being developed to make disclosure meaningful
and measurable for stakeholders. Given the highly competitive
environment in which we operate, this report mostly excludes
financial targets or forward-looking statements other than as
explained on page 1.
References to appendices and links to the website are not
considered part of this integrated annual report but are
included for additional information.
Non-IFRS financial measures and alternative
performance measures
In presenting and discussing our performance, we use certain
alternative performance measures not defined by IFRS
referred to as non-IFRS financial measures, alternative
performance measures or APMs. Such measures include
economic-interest-basis information; trading profit; adjusted
EBITDA; headline earnings; core headline earnings; and
growth in local currency, excluding acquisitions and disposals.
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Material matters
Financial
performance
Responsible
investments
People
Digital
inclusion
Innovation
Climate
action
AI
Cyber-
resilience
Data
privacy
Business culture,
ethics and integrity
Community
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About this report continued
Segmental reviews in this report are prepared showing
revenue on an economic-interest basis (which includes
consolidated subsidiaries and a proportionate share of
associated companies and joint ventures), unless otherwise
stated. Numbers included in brackets represent the equivalent
measure on the basis of growth in local currency, excluding
acquisitions and disposals.
The group provides APMs because the board believes these
provide investors with additional information to measure its
operating performance. These APMs should not be viewed in
isolation as alternatives to the equivalent IFRS measures and
should be used as supplementary information in conjunction
with the most directly comparable IFRS measures. APMs do
not have a standardised meaning under IFRS and therefore
may not be comparable to similar measures presented by
other companies. Their usefulness is therefore subject to
limitations.
Refer to:
» Note 22 ‘Segment information’ of the consolidated financial
statements for a reconciliation to the nearest IFRS measure
of the following APMs used in the segment information:
revenue on an economic-interest basis; adjusted EBITDA;
and trading profit or loss.
» Note 23 ‘Earnings per share’ of the consolidated financial
statements for a reconciliation to the nearest IFRS measure
of headline earnings.
Legislation and frameworks that inform
our reporting
We are guided by the following standards in preparing this
integrated annual report:
» 2013 Framework of the International Integrated Reporting
Council (IIRC) (now part of the IFRS Foundation, which
includes Value Reporting Foundation/SASB): this principles-
based approach promotes the concept of the six capitals1,
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)
that creates and sustains value for our stakeholders.
» We have aligned our climate change approach and our
integrated reporting to the framework of the Task Force on
Climate-related Financial Disclosures (TCFD).
» To meet the needs of investors and analysts and provide
financially material information for all our stakeholders, we
base our disclosures where possible with the industry
standards of the Sustainability Accounting Standards Board
(SASB).
» We support the United Nations Sustainable Development
Goals (UN SDGs) and, like many other businesses, have
identified which goals closely align with our business.
» South African Companies Act 71 of 2008, as amended
(Companies Act).
» King IV Report on Corporate Governance for South Africa
(King IVTM)2.
» IFRS.
Materiality and material matters
We apply the principle of materiality in assessing what
information to include in our integrated annual report. This
report focuses particularly on those issues, opportunities and
challenges that impact materially on the group and its ability
to be a sustainable business that delivers value to key
stakeholders, including our shareholders.
Assurance
Financial information in this report extracted from the audited
Naspers Limited consolidated annual financial statements for
the year ended 31 March 2023 was audited by
PricewaterhouseCoopers Inc. (PwC) (refer to page 212 for its
report). In addition, PwC performed limited assurance on our
scope 1 and 2 carbon footprint (refer to pages 101 to 103).
South African broad-based black economic empowerment
(BBBEE) information (for Naspers and Media24) was assured
by EmpowerLogic.
The group has a combined assurance model for internal use.
This model is designed to cover key risks through a
combination of assurance service providers and functions as
appropriate for Naspers.
An overview of combined assurance per key risk is reported
for consideration by the audit and risk committees.
The scope for our group internal audit and risk support
function includes all controlled assets. 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, such as
forensic specialists or data analytics experts, support the
internal audit function. Other external assurance providers are
enlisted as needed. In our more regulated businesses (like
PayU), regulatory inspectors visit periodically.
The audit committee recommends the appointment of the
external auditor to shareholders, reviews the auditor’s
independence annually and oversees the external audit. The
audit committee makes recommendations to the board and
assists the board in ensuring the integrity of external reports.
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,
clients, customers, regulators and society.
After being reviewed by the audit committee and board,
the board approved the integrated annual report. The
summary consolidated annual financial statements for the
year ended 31 March 2023 were prepared in accordance
with IFRS and the Companies Act, while the integrated
annual report was prepared using the IIRC framework
and recommendations of King IV. In our opinion, the
integrated annual report and annual financial statements
fairly reflect the financial position of the group and its
operations at 31 March 2023.
On behalf of the board
Koos Bekker
Chair
Cape Town
26 June 2023
Bob van Dijk
Chief executive
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1 As identified in the framework of the International Integrated Reporting Council: financial, human, intellectual, manufactured, social and natural capitals.
2 The Institute of Directors in South Africa NPC (IoDSA) owns all copyright and trademarks for King IVTM.
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South Africa
Over a century in South Africa, evolving from the largest print
and TV media business into a 100% global consumer internet
group in the upper middle-income southern African economy;
hard hit by Covid-19; poor utilities management; high-income
inequality; hosts Africa’s largest stock exchange; rising
unemployment, especially youth.
Highlights
2022
Population
80% internet users
Unemployment rate
32.7%
GDP
2%
Inflation
6.9%
2023
Population
60 million*
Naspers offers
» Investing in digital transformation – to grow
South Africa’s tech ecosystem and economy;
create opportunities for SME owners and
independent workers.
» Invest in local entrepreneurs to find local
solutions to change people’s lives for the better.
We partner founders and their teams, providing
advice and expert resources to assist them to
scale their businesses successfully for long-term
growth.
» Naspers Labs – youth development programme
to increase economic participation of
disadvantaged communities, and address youth
unemployment. As part of our total R235m
investment in this programme, we have provided
business support (incubation, acceleration and
market access) to 33 young entrepreneurs,
enabling them to improve their businesses to
become self-sustaining, leverage technology
and grow.
To date, about
3 956 young
South Africans
have been empowered
by Naspers Labs.
» South African employer, investor, and made
substantial contributions to the development of
the country’s society.
» Significant tax contributor.
» As a group, our tax contribution assists
government in addressing some of the
country’s most pressing societal needs.
» ESG:
•
100 Takealot e-bike delivery drivers and
our aim for FY24 is 500.
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Integrated annual report 2023
* Estimated.
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Integrated annual report 2023
171
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Chief executive and chief financial officer
responsibility statement
Statement of responsibility by the board of directors
for the year ended 31 March 2023
Each of the directors, whose names are stated below, hereby confirms that:
a.
the annual financial statements set out on pages 175 to 211, fairly present in all material respects the financial position, financial
performance and cash flows of the issuer in terms of IFRS;
to the best of our knowledge and belief, no facts have been omitted or untrue statements made that would make the annual financial
statements false or misleading;
internal financial controls have been put in place to ensure that material information relating to the issuer and its consolidated subsidiaries
have been provided to effectively prepare the financial statements of the issuer;
the internal financial controls are adequate and effective and can be relied upon in compiling the annual financial statements, having fulfilled
our role and function as executive directors with primary responsibility for implementation and execution of controls;
b.
c.
d.
e. where we are not satisfied, we have disclosed to the audit committee and the auditors any deficiencies in design and operational
effectiveness of the internal financial controls and have taken steps to remedy the deficiencies; and
f. we are not aware of any fraud involving directors.
Bob van Dijk
Chief executive
26 June 2023
Basil Sgourdos
Chief financial officer
In discharging this responsibility, the board of directors of Naspers Limited rely on the management of the group to prepare the
consolidated annual financial statements, separately available at www.naspers.com, in accordance with International Financial
Reporting Standards (IFRS) and the Companies Act 71 of 2008. The summary 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 summary 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 summary consolidated annual financial statements
support the viability of the company and the group. The preparation of the summary consolidated annual financial statements
was supervised by the chief financial officer, 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 summary consolidated annual financial statements were derived.
The directors believe that representations made to the independent auditor during the audit were valid and appropriate.
PricewaterhouseCoopers Inc.’s audit report is presented on page 174.
The summary consolidated annual financial statements were approved by the board of directors on 26 June 2023 and are signed
on its behalf by:
Koos Bekker
Chair
26 June 2023
Bob van Dijk
Chief executive
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172
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Integrated annual report 2023
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Integrated annual report 2023
173
Independent auditor’s report on the
summary consolidated financial statements
Summary consolidated income statement
for the year ended 31 March 2023
To the shareholders of Naspers Limited
Opinion
The summary consolidated financial statements of Naspers Limited, set out on pages 175 to 205 of the Integrated Annual Report, which comprise
the summary consolidated statement of financial position as at 31 March 2023, the summary consolidated income statement, the 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 2023.
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 requirements of the JSE Limited Listings Requirements for summary financial statements,
as set out in note 2 to the summary consolidated financial statements, and the requirements of the Companies Act of South Africa as applicable
to 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 26 June 2023. That report also
includes communication of key audit matters. Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the consolidated financial statements of the current period.
Director’s responsibility for the summary consolidated financial statements
The directors are responsible for the preparation of the summary consolidated financial statements in accordance with the requirements of the
JSE Limited Listings Requirements for summary financial statements, set out in note 2 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 respects,
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.
PricewaterhouseCoopers Inc.
Director: Vicki Myburgh
Registered Auditor
Johannesburg, South Africa
26 June 2023
174
NASPERS
Integrated annual report 2023
Continuing operations
Revenue
Cost of providing services and sale of goods
Selling, general and administration expenses
Other (losses)/gains – net
Operating loss
Interest income
Interest expense
Other finance income/(cost) – net
Dividend income
Share of equity-accounted results1
Impairment of equity-accounted investments
Dilution (losses)/gains on equity-accounted investments
Gains on partial disposal of equity-accounted investments
Net gains/(losses) on acquisitions and disposals
Profit before taxation
Taxation
Profit from continuing operations
Profit from discontinued operations
Profit for the year
Attributable to:
Equity holders of the group
Non-controlling interests
Per share information related to total operations2
Earnings per ordinary share (US cents)
Diluted earnings per ordinary share (US cents)
Per share information related to continuing operations2
Earnings per ordinary share (US cents)
Diluted earnings per ordinary share (US cents)
31 March
Notes
2023
US$’m
2022
US$’m
7
9
8
8
8
11
11
11
11
9
5
6
6 778
(4 883)
(2 532)
(747)
(1 384)
483
(571)
19
62
5 176
(1 745)
(252)
7 622
50
9 460
(48)
9 412
542
9 954
4 331
5 623
9 954
2 078
1 998
1 968
1 888
6 294
(4 662)
(2 454)
(163)
(985)
58
(407)
(91)
—
9 256
(588)
95
12 339
(1 128)
18 549
(64)
18 485
53
18 538
12 223
6 315
18 538
4 218
4 127
4 207
4 116
1 Includes equity-accounted results from associates. Refer to note 11.
2 Earnings per share information is significantly impacted by a lower share in equity-accounted results and a lower gain on partial disposal of equity-accounted investments. Refer
to note 11.
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Integrated annual report 2023
175
Summary consolidated statement
of comprehensive income
for the year ended 31 March 2023
Summary consolidated statement
of financial position
as at 31 March 2023
Profit for the year
Total other comprehensive loss for the year – net of tax
Items that may be subsequently reclassified to profit or loss
Foreign exchange (losses)/gains arising on translation of foreign operations1, 2
Recognition of cash flow hedge
Derecognition of cash flow hedge
Share of equity-accounted investments' movement in OCI3
Items that may not be subsequently reclassified to profit or loss
Fair value gains/(losses) on financial assets through OCI
Share of equity-accounted investments' movement in OCI and NAV4
Total comprehensive income for the year
Attributable to:
Equity holders of the group
Non-controlling interests
Notes
11
31 March
2023
US$’m
9 954
(3 350)
(2 421)
—
—
797
21
(1 747)
2022
US$’m
18 538
(2 391)
1 611
(99)
119
(814)
(509)
(2 699)
6 604
16 147
3 069
3 535
6 604
11 980
4 167
16 147
1 31 March 2023 includes the reclassification to the summary consolidated income statement of US$202m relating to the disposal of Avito (2022: US$1.1bn relating to the loss of
significant influence of VK Company Limited (VK)).
2 The significant movement relates to the translation effects from equity-accounted investments (refer to note 11). The current year also includes a net monetary gain of US$102m
relating to hyperinflation accounting for the group’s subsidiaries in Turkey. Refer to note 2.
3 This relates to movements in equity-accounted investmentsʼ foreign currency translation reserve.
4 This relates mainly to (losses)/gains from the changes in share prices of Tencent’s listed investments carried at fair value through other comprehensive income and the group’s
share in the share-based compensation reserve of equity-accounted investments.
Assets
Non-current assets
Property, plant and equipment
Goodwill
Other intangible assets
Investments in associates
Investments in joint ventures
Other investments and loans1
Trade and financing receivables2
Other receivables2
Deferred taxation
Current assets
Inventory
Trade and financing receivables2
Other receivables and loans2
Derivative financial instruments
Other investments
Short-term investments
Cash and cash equivalents
Assets classified as held for sale
Total assets
Equity and liabilities
Capital and reserves attributable to the group’s equity holders
Share capital and premium
Treasury shares
Other reserves
Retained earnings
Non-controlling interests
Total equity
Non-current liabilities
Capitalised lease liabilities
Liabilities – interest bearing
– non-interest bearing
Other non-current liabilities1
Post-employment medical liability
Cash-settled share-based payment liability
Deferred taxation
Current liabilities
Current portion of long-term liabilities3
Trade payables
Accrued expenses3
Provisions
Other current liabilities
Cash-settled share-based payment liability
Bank overdrafts
Liabilities classified as held for sale
Total equity and liabilities
31 March
Notes
2023
US$’m
2022
US$’m
10
11
12
14
15
15
14
41 667
786
1 483
391
35 930
70
2 807
133
46
21
23 831
415
559
920
5
4 707
6 727
9 849
23 182
649
65 498
18 960
4 611
(46 825)
12 211
48 963
25 645
44 605
16 281
232
15 685
22
140
16
73
113
4 612
487
406
1 938
47
775
655
28
4 336
276
55 793
736
3 458
964
44 461
146
5 862
91
44
31
15 524
571
412
818
27
—
3 924
9 733
15 485
39
71 317
20 581
4 611
(43 753)
14 803
44 920
29 547
50 128
16 550
272
15 611
50
168
21
184
244
4 639
322
609
1 664
9
1 032
985
18
4 639
—
65 498
71 317
1 Non-current derivative assets have been aggregated with other investments and loans, and non-current derivative liabilities with other non-current liabilities as a result of them
being immaterial. Current derivative liabilities have been aggregated with other non-current liabilities as a result of them being immaterial.
2 Financing receivables of US$185m previously aggregated into ‘Other receivables’ are now presented in ‘Trade and financing receivables’ due to the group’s growing credit
business.
3 Accrued interest expense of US$124m previously aggregated into ‘Accrued expenses’ is now presented in ‘Current portion of long-term liabilities’ to present the interest
component with the interest-bearing liabilities.
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Integrated annual report 2023
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Integrated annual report 2023
177
Summary consolidated statement
of changes in equity
for the year ended 31 March 2023
Share
capital
and
premium
US$’m
Treasury
shares
US$’m
Foreign
currency
translation
reserve
US$’m
Existing
control
business
combination
reserve
US$’m
Share-
based
compen-
sation
reserve
US$’m
Valuation
reserve
US$’m
Retained
earnings
US$’m
Share-
holders’
funds
US$’m
Non-
controlling
interest
US$’m
Balance at 1 April 2022
Total comprehensive income for the year
Profit for the year
Total other comprehensive loss for the year
Employee share movements
Repurchase of own shares1
Share-based compensation movements
Share-based compensation expense
Transfers to retained earnings
Modification of share-based compensation benefits
Other share-based compensation movements
Direct equity movements
Direct movements from associates
Transfer of reserves as a result of partial disposals of associates
Transfer of reserves as a result of disposals
Other direct equity movements
Cancellation of written put option liabilities
Remeasurement of written put option liabilities
Other movements
Dividends paid2
Change due to repurchase programme
Repurchase of Prosus shares1
Disposal of Prosus shares1
Change in Prosus shareholding
Other transactions with non-controlling shareholders3
Balance at 31 March 2023
4 611
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
4 611
1 Relates to the share repurchase programme. Refer to note 3.
2 The dividend was approved on 25 August 2022 (2022: 25 August 2021) and was paid on 10 October 2022 (2022: 6 December 2021).
3 The current year relates mainly to the transaction with the non-controlling shareholders of iFood. Refer to note 17.
Balance at 1 April 2021
Total comprehensive income for the year
Profit for the year
Total other comprehensive loss for the year
Movement due to share exchange1
Treasury share movements
Share-based compensation movements
Share-based compensation expense
Other share-based compensation movements
Modification of share-based compensation benefits2
Direct equity movements
Direct movements from associates
Transfer of reserves as a result of partial disposals of associates
Transfer of reserves as a result of disposals
Cancellation of written put option liabilities
Remeasurement of written put option liabilities
Other movements
Dividends paid3
Transactions with non-controlling shareholders
Balance at 31 March 2022
Share
capital
and
premium
US$’m
4 611
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
4 611
(43 753)
—
—
—
102
(3 174)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
(46 825)
Treasury
shares
US$’m
(3 679)
—
—
—
(38 762)
(1 312)
—
—
—
—
—
—
—
—
—
—
—
—
(43 753)
(1 430)
(652)
—
(652)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
5
(2 077)
Foreign
currency
translation
reserve
US$’m
(1 841)
381
—
381
—
—
—
—
—
30
—
—
30
—
—
—
—
(1 430)
3 002
(1 085)
—
(1 085)
—
—
—
—
—
—
—
433
144
120
169
—
—
—
—
—
—
—
—
—
—
2 350
Valuation
reserve
US$’m
5 044
(1 155)
—
(1 155)
—
—
—
—
—
(887)
(507)
(332)
(48)
—
—
—
—
3 002
10 420
—
—
—
—
—
—
—
—
—
—
(46)
—
—
(72)
26
18
72
—
—
(741)
(10 043)
2 752
6 550
(933)
8 790
2 811
475
—
475
—
—
20
67
—
(6)
(41)
(158)
—
(158)
—
—
—
—
—
—
—
—
—
—
—
3 148
Existing
control
business
combination
reserve
US$’m
Share-
based
compen-
sation
reserve
US$’m
(9 346)
—
—
—
21 812
—
—
—
—
—
7
—
—
7
94
100
—
—
(2 247)
10 420
2 390
531
—
531
—
3
50
(45)
(2)
(117)
—
(117)
—
—
—
4
—
—
2 811
44 920
4 331
4 331
—
—
—
10
—
—
4
6
(229)
(144)
38
(97)
(26)
—
—
9
(78)
—
—
—
—
—
48 963
Retained
earnings
US$’m
32 015
12 223
12 223
—
—
(125)
—
45
(170)
967
507
449
11
8
—
8
(176)
—
44 920
20 581
3 069
4 331
(1 262)
102
(3 174)
30
67
—
(2)
(35)
—
—
—
—
—
18
72
9
(78)
(741)
(10 043)
2 752
6 550
(928)
18 960
Share-
holders’
funds
US$’m
29 194
11 980
12 223
(243)
(16 950)
(1 312)
(122)
50
—
(172)
—
—
—
—
102
100
12
(176)
(2 247)
20 581
29 547
3 535
5 623
(2 088)
—
—
63
81
—
(4)
(14)
—
—
—
—
—
23
96
(6)
(113)
(6 550)
—
—
(6 550)
(950)
25 645
Non-
controlling
interest
US$’m
11 667
4 167
6 315
(2 148)
16 828
—
(108)
75
—
(183)
—
—
—
—
24
137
—
(62)
(3 106)
29 547
Total
US$’m
50 128
6 604
9 954
(3 350)
102
(3 174)
93
148
—
(6)
(49)
—
—
—
—
—
41
168
3
(191)
(7 291)
(10 043)
2 752
—
(1 878)
44 605
Total
US$’m
40 861
16 147
18 538
(2 391)
(122)
(1 312)
(230)
125
—
(355)
—
—
—
—
126
237
12
(238)
(5 353)
50 128
1 Refer to note 3 for details of the share exchange transaction.
2 The decrease in retained earnings includes a decrease of US$479.5m related to the modification of equity-settled schemes.
3 The dividend was approved on 25 August 2021 and was paid on 6 December 2021.
178
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Integrated annual report 2023
NASPERS
Integrated annual report 2023
179
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Summary consolidated statement of cash flows
for the year ended 31 March 2023
Notes to the summary
consolidated financial statements
for the year ended 31 March 2023
Cash flows from operating activities
Cash utilised in operations
Interest income received
Dividends received from equity-accounted investments
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, net of cash
Disposals of subsidiaries, businesses, associates and joint ventures, net of cash
Acquisition of short-term investments1
Maturity of short-term investments1
Cash paid for other investments2
Cash received from other investments3
Cash movement in other investing activities
Net cash generated from investing activities
Cash flows from financing activities
Proceeds from sale of subsidiary shares
Payments for the repurchase of own shares
Proceeds from long and short-term loans raised
Repayments of long and short-term loans
Acquisition of group shares for equity-settled share-based compensation plans
Additional investment in existing subsidiaries4
Dividends paid by the holding company
Repayments of capitalised lease liabilities
Additional investment from non-controlling shareholders
Cash movements in other financing activities
Net cash (utilised in)/generated from 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
31 March
Notes
2023
US$’m
2022
US$’m
16
16
16
16
3
3
(376)
324
575
(567)
(133)
(177)
(290)
(324)
12 668
(6 606)
3 924
(559)
3 764
(22)
(734)
46
572
(389)
(197)
(702)
(258)
(4 580)
14 641
(3 966)
1 486
(1 480)
85
(22)
12 555
5 906
2 745
(3 150)
196
(56)
(125)
(11 509)
(191)
(63)
67
(10)
(12 096)
282
(82)
9 715
(94)
9 821
—
(1 286)
9 564
(1 619)
(218)
(5 269)
(238)
(60)
140
(120)
894
6 098
(132)
3 749
—
9 715
1 Relates to short-term cash investments with maturities of more than three months from date of acquisition.
2 Relates to payments for the group’s fair value through other comprehensive income investments.
3 Relates mainly to the group’s investments measured at fair value. Cash received from other investments includes US$54m dividends received from the JD.com investment.
4 Relates to transactions with non-controlling interests resulting in changes in effective interest of existing subsidiaries. Includes the repurchase of Prosus shares on the market of US$9.9bn
(2022: US$5.0bn). Refer to note 3.
1.
2.
General information
Naspers Limited (Naspers or the group) is a global consumer internet group and one of the largest technology investors in the world.
Naspers has its primary listing on the Johannesburg Stock Exchange (JSE) in South Africa. Through Prosus N.V. (Prosus) the group
operates and invests in countries and markets with long-term growth potential, building leading consumer internet companies that
empower people and enrich communities. Prosus has its primary listing on Euronext Amsterdam and a secondary listing on the JSE
and A2X Markets. Naspers is the majority shareholder of Prosus based on the voting rights and control structure of the Prosus group.
The summary consolidated financial statements for the year ended 31 March 2023 have been authorised for issue by the board of
directors on 26 June 2023.
Basis of presentation and accounting policies
Information on the summary consolidated financial statements
The summary consolidated financial statements for the year ended 31 March 2023 have been prepared in accordance with International
Financial Reporting Standard (IFRS), the South African Institute of Chartered Accountants (SAICA) Financial Reporting Guides as issued
by the Accounting Practices Committee, and Financial Pronouncements as issued by the Financial Reporting Standards Council as well
as the requirements of the Companies Act of South Africa and the JSE Listings Requirements. These summary consolidated financial
statements contain the information required by IAS 34 Interim Financial Reporting (IAS 34) with the exception of IAS 34.20(b) and,
accordingly, the financial information for the second half of the current year is not presented separately.
The summary consolidated financial statements 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 in these
summary consolidated financial statements are consistent with those applied in the previous consolidated annual financial statements for
the year ended 31 March 2022, except for the impact of hyperinflation detailed below.
There were no new or amended accounting pronouncements effective from 1 April 2022 that have a significant impact on the group’s
summary consolidated financial statements.
The summary consolidated financial statements presented here report earnings per share, diluted earnings per share, headline earnings
per share and diluted headline earnings per share (collectively referred to as earnings per share) per class of ordinary shares. These
are calculated as the relationship of the number of ordinary shares (or dilutive ordinary shares where relevant) of Naspers issued at
31 March 2023 (net of treasury shares), to the relevant net profit measure attributable to the shareholders of Naspers.
The earnings per share information presented takes into account the impact of the share repurchase programme.
All amounts disclosed are in millions of US dollars (US$’m) unless otherwise stated.
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Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
2.
Basis of presentation and accounting policies continued
Information on the summary consolidated financial statements continued
Operating segments
The group’s operating segments reflect the components of the group that are regularly reviewed by the chief operating decision-maker
(CODM) as defined in note 22 ‘Segment Information’ in the consolidated financial statements as included in the annual financial
statements for the year ended 31 March 2023. The group proportionately consolidates its share of the results of its associates and joint
ventures in its disclosure of segment results in note 4.
From 1 April 2022, following the operational separation from the OLX Group, the CODM reviewed the financial results of Avito separately
from the Classifieds Ecommerce segment. The financial results of Avito are presented separately as a discontinued operation in the
operating segment information up until the date of disposal as a result of the group’s decision to exit the Russian business.
In March 2023, the group announced its decision to exit the OLX Autos business unit. The exit process is being executed for each
operation within the business unit in its local market. The business unit as a whole represents a separate major line of business, both
in terms of the distinct nature of the business and its contribution to the operational performance of the group. As such, the operations
that are classified as held for sale and the operations that are closed down by 31 March 2023 have been presented as discontinued
operations and are reviewed separately by the CODM. OLX Autos operations whose exit process has not been finalised as at
31 March 2023 are presented as continuing operations. These operations will be classified as discontinued operations in the financial
year that the exit process is completed.
The comparative financial results of Avito and the relevant operations in the OLX Autos business described above, previously presented in
the Classifieds Ecommerce segment, have been reclassified and presented in discontinued operations to allow the current performance
of the business to be compared with prior periods. The change has no impact on the total group revenue, adjusted EBITDA and trading
(loss)/profit in prior periods.
Lag periods applied when reporting results of equity-accounted investments
Where the reporting periods of associates and joint ventures (equity-accounted investments) are not coterminous with that of the group and/
or it is impracticable for the relevant equity-accounted investee to prepare financial statements as of 31 March (for instance due to the
availability of the results of the equity-accounted investee relative to the group’s reporting period), the group applies an appropriate lag
period of not more than three months in reporting the results of the equity-accounted investees. Significant transactions and events that occur
between the non-coterminous reporting periods are adjusted for. The group exercises significant judgement when determining the transactions
and events for which adjustments are made.
2.
Basis of presentation and accounting policies continued
Information on the summary consolidated financial statements continued
Going concern
The summary consolidated financial statements are prepared on the going-concern basis. Based on forecasts and available cash
resources, the group has adequate resources to continue operations as a going concern in the foreseeable future. As at 31 March 2023,
the group recorded US$16.6bn in cash, comprising US$9.9bn of cash and cash equivalents and US$6.7bn in short-term cash investments.
The group had US$16bn of interest-bearing debt (excluding capitalised lease liabilities) and an undrawn US$2.6bn revolving credit
facility.
In assessing going concern, the impact of internal and external economic factors on the group’s operations and liquidity was considered
in preparing the forecasts and in assessing the group’s actual performance against budget. The board is of the opinion that the group
has sufficient financial flexibility to continue as a going concern in the year subsequent to the date of these summary consolidated
financial statements.
Hyperinflation
In June 2022, the International Monetary Fund declared Turkey as a hyperinflationary economy. Accordingly, the group applied the
hyperinflationary accounting requirements of IAS 29 Financial Reporting in Hyperinflationary Economies for the group’s subsidiaries in
Turkey. As the presentation currency of the group is that of a non-hyperinflationary economy, comparative amounts are not adjusted for
changes in the price level or exchange rates in the current year.
On initial application of hyperinflationary accounting, opening equity for the group’s subsidiaries is restated by applying a general
price index from the date transactions arose. These restatements are recognised directly in equity. Subsequent to initial application, all
components of equity are restated by applying a general price index from the beginning of the period or the date of contribution, if later.
The restatement of opening equity on initial application is not material.
The results, cash flows and financial position for the group’s subsidiaries in Turkey are adjusted using a general price index to reflect the
current purchasing power at the end of the reporting period. The carrying amounts of non-monetary assets and liabilities are adjusted
to reflect the change in the general price index from the date of acquisition of these subsidiaries to the end of the reporting period. The
gain or loss on the net monetary position from translation of the financial information is recognised in the summary consolidated income
statement, except for goodwill, other intangible assets and deferred tax liabilities arising at acquisition of these subsidiaries. The impact
of the gain on the net monetary position in the summary consolidated income statement is not material.
Goodwill, other intangible assets and deferred tax liabilities arising at acquisition of these subsidiaries are restated using the general
price index at the end of the reporting period. The gain or loss on the net monetary position from the adjustment of these assets and
liabilities is recognised in other comprehensive income and accumulated in the foreign currency translation reserve in equity.
The general price index as published by the Turkish Statistical Institute was used in adjusting the results, cash flows and financial position
for the group’s subsidiaries in Turkey up to 31 March 2023. The general price inflation factor up to 31 March 2023 was 275.99%.
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Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
3.
Significant changes in financial position and performance during the reporting period
Share repurchase programme
On 27 June 2022, the group announced the beginning of an open-ended repurchase programme of Prosus ordinary shares N and
Naspers N ordinary shares.
The Prosus repurchase programme of its ordinary shares N is funded by an orderly on-market sale of Tencent Holdings Limited (Tencent)
shares. Until 12 August 2022, Prosus also purchased Naspers N ordinary shares.
In September 2022, Naspers began to dispose of some of the Prosus shares that it holds in order to provide further funding for the
repurchase of Naspers shares pursuant to the repurchase programme.
The group has appointed agents to execute the repurchase programme and sale of Tencent shares within parameters set by the
group and subject to applicable laws and regulations. As part of the repurchase programme, for the period between 28 June 2022
and 31 March 2023, Prosus purchased 4 152 285 Naspers N ordinary shares for a total consideration of US$626m and repurchased
152 797 117 Prosus ordinary shares N for a total consideration of US$10.0bn, of which US$9.9bn was settled in cash by 31 March 2023.
These transactions were mainly funded by the sale of 267 664 800 Tencent shares yielding proceeds of US$10.7bn. Furthermore, for
the year ended 31 March 2023, Naspers, through its subsidiary MIH Treasury Services (Pty) Limited, purchased 16 320 371 Naspers
N ordinary shares on the market for a total consideration of US$2.5bn. This transaction was funded by Naspers’ disposal of 43 356 695
Prosus ordinary shares N on the market, yielding proceeds of US$2.8bn.
Subsequent to the above transactions, Prosus now holds a 52.5%1 (2022: 49.5%) fully diluted interest, representing a 52.7%2 (2022: 49.9%)
economic interest in Naspers. Prosus’ legal ownership in Naspers remains less than 50% as at 31 March 2023.
The accounting for the share repurchase programme takes into consideration the cross-holding agreement between Prosus and Naspers
and is implemented in accordance with the applicable laws and regulations as well as the authority granted by shareholders. The
repurchase programme has no impact on the control structure of the group. Prosus’ interest in Naspers does not represent control or
significant influence. Naspers therefore continues to hold the majority of the shareholder voting rights of Prosus.
The cross-holding agreement between Naspers and Prosus became effective at the time of closing of the voluntary share exchange in
August 2021. The cross-holding agreement takes into account Prosus’ indirect interest in itself from holding Naspers shares and deals
with how distributions between the two groups will be managed. It eliminates the need for flows back and forth between the two groups
as a result of the cross-shareholding, through a waiver by Prosus of its entitlement to distributions on the Naspers shares that it holds,
and provides clarity to both Prosus and Naspers’ free-float shareholders of their economic interest in distributions made by Prosus. The
cross-holding agreement relates to Prosus’ fully diluted interest in Naspers and Naspers’ legal ownership of Prosus ordinary shares N. At
31 March 2023, subject to this agreement and subsequent to the repurchase transactions above Prosus’ free-float shareholders’ economic
interest in the Prosus group is 56.5% (2022: 57.7%).
Disposal of Prosus shares and Prosus repurchase of own shares
The group’s sale and repurchase of Prosus ordinary shares N impacted the Prosus free-float economic interest in the group. The
transactions were accounted for as equity transactions as the change in economic interest had no impact on the control structure of the
group. The consideration paid for the Prosus share repurchase and the consideration received for the disposal of Prosus shares resulted
in a US$6.6bn decrease in the non-controlling interest in equity. The excess of the net consideration for Prosus shares over the decrease
in non-controlling interest was recognised in ‘Existing control business combination reserve’ in equity, amounting to US$741m.
Naspers repurchase of own shares and Prosus acquisition of Naspers shares
The Naspers N ordinary shares acquired by Prosus and repurchased by Naspers are classified as treasury shares. These are recognised
in ‘Treasury shares’ on the summary consolidated statement of financial position. The treasury shares were recognised at a cost
of US$3.2bn.
Disposal of shares in Tencent
The group reduced its ownership interest in Tencent from 28.81% to 26.16%, yielding US$10.7bn in proceeds. This is a partial disposal of
an associate that does not result in a loss of significant influence. The group recognised a gain on partial disposal of US$7.6bn in the
summary consolidated income statement. The group reclassified a loss of US$155m from the foreign currency translation reserve to the
summary consolidated income statement related to this partial disposal.
Other transactions with non-controlling shareholders
In August 2022, the group entered into an agreement through its subsidiary MIH Movile Holdings B.V. (Movile) to acquire the remaining
33.3% stake in iFood Holdings B.V. (iFood) and IF-JE Holdings B.V., from non-controlling shareholder Just Eat Holding Limited (Just Eat). The
transaction was completed in November 2022. Refer to note 17.
1 Interest in Naspers based on the cross-holding agreement formula, which was approved in the shareholder resolution.
2 Interest based on distribution rights to each class of shareholders.
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3.
Significant changes in financial position and performance during the reporting period continued
Exit of the OLX Autos business unit
In March 2023, the group announced the decision to exit the OLX Autos business unit. The OLX Autos business unit is a second-hand
car-sale ecommerce marketplace which operates through a single technological platform located in various regions. The group
believes that significant value exists in the business within its various local markets. Based on this and the ongoing exit process,
options for the business are being considered, resulting in the decision to sell or close down each operation in its local market.
The business unit as a whole represents a separate major line of business, both in terms of the distinct nature of the business and its
contribution to the operational performance of the group. The operations of this business classified as held for sale and those that
have been closed down by 31 March 2023 are presented as discontinued operations.
The OLX Autos operations whose exit process has not been finalised as at 31 March 2023 are presented as continuing operations given
the phased exit process for this business. These operations will be classified as discontinued operations in the financial year that the exit
process is completed.
OLX Autos revenue and trading loss for the year were US$1.8bn (2022: US$1.6bn) and US$418m (2022: US$230m) respectively, of which
US$853m (2022: US$601m) of revenue and US$216m (2022: US$107m) of trading losses are included in continuing operations.
The group recognised total impairment losses of US$164m of which US$19m is included in discontinued operations. The impairment
losses relate to US$116m of goodwill and US$48m of other assets. The other assets impaired are property, plant and equipment and
other intangible assets that will not be recovered through the sale of the business.
Profit from discontinued operations
Discontinued operations consist of the group’s Russian business and the OLX Autos business unit. Refer to note 5 for financial information
related to the group’s discontinued operations.
4.
Segmental review
Reconciliation of consolidated adjusted EBITDA and trading loss to consolidated operating loss from continuing operations
Consolidated adjusted EBITDA from continuing operations1
Depreciation
Amortisation of software
Interest on capitalised lease liabilities
Consolidated trading loss from continuing operations2
Interest on capitalised lease liabilities
Amortisation of other intangible assets
Other (losses)/gains – net
Other
Retention option expense
Remeasurement of cash-settled share-based incentive expenses
Share-based incentives for share options settled in Naspers Limited shares
Consolidated operating loss from continuing operations
Year ended
31 March
2023
US$’m
2022
US$’m
(685)
(129)
(15)
(15)
(844)
15
(80)
(747)
3
(20)
304
(15)
(1 384)
(557)
(108)
(8)
(11)
(684)
11
(81)
(163)
6
(19)
(27)
(28)
(985)
1 Adjusted EBITDA represents operating profit/loss, as adjusted, to exclude depreciation; amortisation; retention option expenses linked to business combinations; other losses/
gains – net, which includes dividends received from investments, profits and losses on sale of assets, fair value adjustments of financial instruments, impairment losses,
cash-settled share-based compensation expenses deemed to arise from shareholder transactions by virtue of employment; and subsequent fair value remeasurement of
cash-settled share-based compensation expenses, equity-settled share-based compensation expenses for group share option schemes as well as those deemed to arise
on shareholder transactions (but not excluding share-based payment expenses for which we have a cash cost on settlement with participants). It is considered a useful
measure to analyse operational profitability.
2 Trading profit/(loss) refers to adjusted EBITDA adjusted for depreciation, amortisation of software and interest on capitalised lease liabilities. It is considered a useful
measure to analyse operational profitability.
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Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
4.
Segmental review continued
4.
Segmental review continued
Continuing operations
Ecommerce
Classifieds1, 2
Food Delivery
Payments and Fintech
Edtech
Etail
Other
Social and internet platforms
Tencent
VK3
Media
Corporate segment
Intersegmental
Total economic interest from continuing operations
Less: Equity-accounted investments
Total consolidated from continuing operations
Total from discontinued operations1, 2
Total consolidated
Revenue
Year ended 31 March
2023
US$’m
2022
US$’m
%
change
10 754
1 575
4 203
1 052
545
2 761
618
22 269
22 269
—
217
—
(3)
9 005
1 324
2 992
796
425
3 086
382
25 794
25 261
533
257
—
—
33 237
(26 459)
35 056
(28 762)
6 778
1 626
8 404
6 294
1 646
7 940
19
19
40
32
28
(11)
62
(14)
(12)
(100)
(16)
—
(100)
(5)
(8)
8
(1)
6
Continuing operations
Ecommerce
Classifieds1, 2
Food Delivery
Payments and Fintech
Edtech
Etail
Other
Social and internet platforms
Tencent
VK3
Media
Corporate segment
Intersegmental
Total economic interest from continuing operations
Less: Equity-accounted investments
Total consolidated from continuing operations
Total from discontinued operations1, 2
Total consolidated
Adjusted EBITDA
Year ended 31 March
2023
US$’m
2022
US$’m
%
change
(1 263)
(113)
(545)
(108)
(239)
(2)
(256)
6 295
6 295
—
13
(201)
—
4 844
(5 529)
(685)
46
(639)
(1 009)
(37)
(651)
(52)
(100)
27
(196)
7 623
7 502
121
23
(209)
—
6 428
(6 985)
(557)
133
(424)
(25)
>(100)
16
>(100)
>(100)
>(100)
(31)
(17)
(16)
(100)
(43)
4
—
(25)
21
(23)
(65)
(51)
1 From 1 April 2022, following the separation from OLX Group, the CODM reviewed the financial results of Avito separately. Subsequent to the group’s decision to exit this
Russian business, Avito was presented as a discontinued operation up until the date of disposal. The comparative financial results of Avito, previously presented in the
Classifieds Ecommerce segment, have been reclassified and presented in discontinued operations. Refer to note 5.
2 From 1 March 2023, following the group’s decision to exit the OLX Autos business unit, its operations classified as held for sale and those that have been closed by
31 March 2023 were presented as a discontinued operation. The OLX Autos business unit is a separate major line of business, both in terms of the distinct nature of the
business and its contribution to the operational performance of the group. The comparative financial results of these operations previously presented in the Classifieds
Ecommerce segment, have been reclassified and presented in discontinued operations. Refer to note 5.
3 During the year ended 31 March 2022, the group lost significant influence in VK Company Limited (VK). In November 2022, the group signed an agreement with VK to
renounce all VK shares and shareholder rights for no consideration.
1 From 1 April 2022, following the separation from OLX Group, the CODM reviewed the financial results of Avito separately. Subsequent to the group’s decision to exit this
Russian business, Avito was presented as a discontinued operation up until the date of disposal. The comparative financial results of Avito, previously presented in the
Classifieds Ecommerce segment, have been reclassified and presented in discontinued operations. Refer to note 5.
2 From 1 March 2023, following the group’s decision to exit the OLX Autos business unit, its operations classified as held for sale and those that have been closed by
31 March 2023 were presented as a discontinued operation. The OLX Autos business unit is a separate major line of business, both in terms of the distinct nature of the
business and its contribution to the operational performance of the group. The comparative financial results of these operations previously presented in the Classifieds
Ecommerce segment, have been reclassified and presented in discontinued operations. Refer to note 5.
3 During the year ended 31 March 2022, the group lost significant influence in VK Company Limited (VK). In November 2022, the group signed an agreement with VK to
renounce all VK shares and shareholder rights for no consideration.
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Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
4.
Segmental review continued
Continuing operations
Ecommerce
Classifieds1, 2
Food Delivery
Payments and Fintech
Edtech
Etail
Other
Social and internet platforms
Tencent
VK3
Media
Corporate segment
Intersegmental
Total economic interest from continuing operations
Less: Equity-accounted investments
Total consolidated from continuing operations
Total from discontinued operations1, 2
Total consolidated
Trading (loss)/profit
Year ended 31 March
2023
US$’m
2022
US$’m
%
change
(1 534)
(156)
(649)
(116)
(258)
(85)
(270)
5 085
5 085
—
7
(210)
—
3 348
(4 192)
(844)
26
(818)
(1 215)
(70)
(724)
(60)
(117)
(42)
(202)
6 319
6 273
46
17
(217)
—
4 904
(5 588)
(684)
97
(587)
(26)
>(100)
10
(93)
>(100)
>(100)
(34)
(20)
(19)
(100)
(59)
3
—
(32)
25
(23)
(73)
(39)
1 From 1 April 2022, following the separation from OLX Group, the CODM reviewed the financial results of Avito separately. Subsequent to the group’s decision to exit this
Russian business, Avito was presented as a discontinued operation up until the date of disposal. The comparative financial results of Avito, previously presented in the
Classifieds Ecommerce segment, have been reclassified and presented in discontinued operations. Refer to note 5.
2 From 1 March 2023, following the group’s decision to exit the OLX Autos business unit, its operations classified as held for sale and those that have been closed by
31 March 2023 were presented as a discontinued operation. The OLX Autos business unit is a separate major line of business, both in terms of the distinct nature of the
business and its contribution to the operational performance of the group. The comparative financial results of these operations previously presented in the Classifieds
Ecommerce segment, have been reclassified and presented in discontinued operations. Refer to note 5.
3 During the year ended 31 March 2022, the group lost significant influence in VK Company Limited (VK). In November 2022, the group signed an agreement with VK to
renounce all VK shares and shareholder rights for no consideration.
5.
Profit from discontinued operations
Discontinued operations consist of the group’s Russian business and the OLX Autos business unit.
In May 2022, as a result of the continued conflict in the region, the group announced its decision to exit its Russian business. Accordingly,
Avito was presented as a discontinued operation. The group entered into an agreement to sell its shareholding in Avito to Kismet
Capital Group (Kismet) for a total cash consideration of US$2.4bn. Kismet is a private investment group with a track record of investing in
technology and telecommunications businesses in Russia. The transaction was completed in October 2022. The group recognised a gain
on disposal of the subsidiary of US$568m, including a reclassification of the accumulated foreign currency translation gain of US$202m.
Discontinued operations for the OLX Autos business include the operations classified as held for sale and the operations closed down by
31 March 2023. Refer to note 14 for details of this business unit’s disposal group.
The financial information relating to the group’s discontinued operations is set out below:
Income statement information of discontinued operations
Revenue
Online sale of goods revenue
Classifieds listings revenue
Advertising revenue
Other revenue
Expenses
Impairment of goodwill and other assets1
Other expenses
Profit before tax
Taxation
(Loss)/profit for the year
Gain on disposal of discontinued operation
Profit from discontinued operations
Profit from discontinued operations attributable to:
Equity holders of the group
Non-controlling interest
1 Relates to impairment losses of goodwill and other assets in the OLX Autos business unit.
Cash flow statement information of discontinued operations
Net cash generated from operating activities
Net cash generated from/(utilised in) investing activities1
Net cash generated from/(utilised in) financing activities
Cash generated by discontinued operations
1 Includes the net cash inflow from the disposal of Avito. Refer to note 16.
Per share information from discontinued operations1
Earnings per N ordinary share
Diluted earnings per N ordinary share
Headline earnings per N ordinary share
Diluted headline earnings per N ordinary share
31 March
2023
US$’m
1 626
944
601
50
31
(1 606)
(19)
(1 587)
20
(46)
(26)
568
542
229
313
542
31 March
2023
US$’m
145
1 985
130
2 260
2022
US$’m
1 646
980
582
50
34
(1 550)
—
(1 550)
96
(43)
53
—
53
32
21
53
2022
US$’m
153
(22)
(86)
45
31 March
2023
US cents
2022
US cents
110
110
—
—
11
11
12
12
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188
NASPERS
Integrated annual report 2023
NASPERS
Integrated annual report 2023
189
1 Refer to note 6 for further details on the earnings per share from discontinued operations.
o
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Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
6.
Earnings per share
Calculation of headline earnings
6.
Earnings per share continued
Earnings from continuing operations
Basic earnings attributable to shareholders
Impact of dilutive instruments of subsidiaries, associates and joint ventures
Diluted earnings attributable to shareholders
Headline adjustments for continuing operations
Adjusted for:
Impairment of other assets
Impairment of goodwill, PPE and other intangible assets
Loss/(gain) on sale of assets
Gain recognised on loss of control
(Gains)/losses recognised on loss of significant influence
Net gains on acquisitions and disposals of investments
Gain on partial disposal of equity-accounted investments
Dilution losses/(gains) on equity-accounted investments
Remeasurements included in equity-accounted earnings2
Impairment of equity-accounted investments
Total tax effects of adjustments
Total adjustment for non-controlling interest
Basic headline earnings from continuing operations1
Diluted headline earnings from continuing operations
Earnings from discontinued operations
Basic earnings attributable to shareholders
Impact of dilutive instruments of subsidiaries, associates and joint ventures
Diluted earnings attributable to shareholders
Headline adjustments for discontinued operations
Adjustments for:
Loss on sale of property, plant and equipment
Impairment of goodwill, intangible assets and other assets
Net (gains)/loss on acquisitions and disposals of investments
Total tax effects of adjustments
Total adjustment for non-controlling interest
Basic headline earnings from discontinued operations1
Diluted headline earnings from discontinued operations
Year ended
31 March
2023
US$’m
2022
US$’m
4 102
(166)
3 936
(8 835)
33
720
3
(23)
(30)
(27)
(7 622)
252
(3 886)
1 745
(4 733)
—
4 982
249
83
229
—
229
(544)
5
19
(568)
(315)
—
315
—
—
12 191
(230)
11 961
(15 659)
—
246
(4)
—
1 112
(33)
(12 339)
(95)
(5 134)
588
(3 468)
—
5 054
1 586
1 356
32
—
32
3
—
—
3
35
—
—
35
35
1 Headline earnings represent net profit for the year attributable to equity holders of the group, excluding certain defined separately identifiable remeasurements. The
headline earnings measure is pursuant of the JSE Listings Requirements.
2 Remeasurements included in equity-accounted earnings include US$5.9bn (2022: US$6.3bn) relating to gains arising on acquisitions and disposals by associates and
US$1.9bn (2022: impairment of US$1.1bn) relating to net impairments of assets recognised by associates.
Year ended
31 March
2023
Number of
shares
2022
Number of
shares
196 320 624
215 454 129
12 083 718
74 322 479
208 404 342
88 097
289 776 608
805 932
208 492 439
290 582 540
1 968
1 888
119
40
4 207
4 116
547
467
Number of ordinary shares in issue at year-end (net of treasury shares)
Weighted adjustment for movement in shares held by share trusts and share repurchase
programme
Weighted average number of ordinary shares in issue during the year
Adjusted for effect of future share-based payment transactions
Diluted weighted average number of ordinary shares in issue during the year
Per share information related to continuing operations
Earnings per ordinary share (US cents) for the year
Basic
Diluted
Headline earnings per ordinary share (US cents) for the year
Basic
Diluted
Earnings per share information
The earnings per share information presented takes into account the impact of the cross-holding agreement with Naspers as a result of
the Prosus share exchange and the group’s repurchase of the Naspers shares.
The group has in issue 435 511 058 N ordinary shares and 961 193 A ordinary shares as at 31 March 2023. The group recognised
240 151 627 N ordinary shares as treasury shares, which are the N ordinary shares held by the Naspers group share trusts and other
group companies.
The A ordinary shareholders are entitled to one voting right per share but carries one fifth of the economic rights of Naspers N ordinary
shareholders.
The number of shares in issue used in the earnings per share information is weighted for the period that the shares were in issue and
not recognised as treasury shares. As a result, the N ordinary shares held by Prosus and Naspers group subsidiaries, are weighted for the
period they were in issue and not recognised as treasury shares. Refer to note 3 for the impact of the share repurchase programme.
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190
NASPERS
Integrated annual report 2023
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Integrated annual report 2023
191
Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
7.
Revenue
8.
Finance (costs)/income
Online sale of goods revenue
Classifieds listings revenue
Payment transaction commissions and fees1
Mobile and other content revenue
Food-delivery revenue
Advertising revenue
Educational technology revenue
Printing, distribution, circulation, publishing and subscription revenue
Other revenue
Reportable
segment(s)
where revenue
is included
Etail and Classifieds
Classifieds
Various
Other Ecommerce
Food Delivery
Various
Edtech
Media
Various
Year ended
31 March
2023
US$’m
2022
US$’m
3 358
436
987
52
1 366
99
134
120
226
6 778
3 511
426
703
71
986
125
83
138
251
6 294
1 This revenue is generated primarily from the Payments and Fintech segment and includes interest income revenue relating to the group’s credit business across various
segments.
Revenue in the table above relates to revenue from contracts with customers except for interest income revenue of US$91m
(2022: US$14m) relating to the group’s credit business in various segments.
Revenue is presented on an economic-interest basis (ie including the proportionate consolidation of the revenue of associates and joint
ventures) in the group’s segmental review and is, accordingly, not directly comparable to the above consolidated revenue figures. Below
is the group’s revenue by geographic area:
Interest income
Loans and bank accounts1
Other
Interest expense
Loans and overdrafts
Capitalised lease liabilities
Other
Other finance income/(cost) – net
Gain on translation of assets and liabilities
(Losses)/gains on derivative and other financial instruments2
1 The increase in the current year relates primarily to increased cash and short-term investments.
2 The prior year includes a cost of US$217m related to the early settlement of portions of the 2025 and 2027 bonds.
Year ended
31 March
2023
US$’m
2022
US$’m
483
454
29
(571)
(520)
(15)
(36)
19
101
(82)
58
42
16
(407)
(385)
(11)
(11)
(91)
135
(226)
9.
Profit before taxation
In addition to the items already detailed, profit before taxation has been determined after taking into account, inter alia, the following:
Year ended
31 March
2023
US$’m
2022
US$’m
1 077
1 071
6
528
2 834
641
2 131
62
2 252
87
—
6 778
1 135
1 129
6
358
2 959
736
2 124
99
1 776
65
1
6 294
Depreciation
Amortisation
Other intangible assets
Software
Impairment losses on financial assets measured at amortised cost
Net realisable value adjustments on inventory, net of reversals1
Other (losses)/gains – net
(Loss)/profit on sale of assets
Impairment of goodwill, PPE and other intangible assets
Impairment of other assets
Dividends received from investments
Income on business support services
Other
Net gains/(losses) on acquisitions and disposals
Gains on disposal of investments net
Gains on loss of control transactions
Gains on sale of business
Gains/(losses) on loss of significant influence2
Remeasurement of contingent consideration
Transaction-related costs
1 Net realisable value writedowns relate primarily to the Classifieds and Etail segments.
2 In the prior year the group reclassified a portion of the foreign currency translation reserves related to VK from ‘Other comprehensive incomeʼ to the summary consolidated
income statement, amounting to a loss of US$1.1bn as a result of the loss of significant influence.
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Year ended
31 March
2023
US$’m
129
95
80
15
36
23
(747)
(3)
(720)
(33)
—
8
1
50
26
23
1
30
1
(31)
2022
US$’m
108
89
81
8
11
13
(163)
4
(246)
—
45
34
—
(1 128)
33
—
—
(1 112)
(6)
(43)
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NASPERS
Integrated annual report 2023
193
Geographical area
Africa
South Africa
Rest of Africa
Asia
Europe
Central Europe
Eastern Europe
Western Europe
Latin America
North America
Other
Total revenue from continuing operations
192
NASPERS
Integrated annual report 2023
Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
10.
Goodwill
Movements in the group’s goodwill for the year are detailed below:
11.
Investments in associates
The movements in the carrying value of the group’s investments in associates for the year are detailed in the table below:
Goodwill
Cost
Accumulated impairment
Opening balance
Foreign currency translation effects1
Acquisitions of subsidiaries and businesses
Disposals of subsidiaries and businesses
Transferred to assets classified as held for sale2, 3
Impairment
Closing balance
Cost
Accumulated impairment
Year ended
31 March
2023
US$’m
2022
US$’m
3 818
(360)
3 458
356
11
(9)
(1 649)
(684)
1 483
2 448
(965)
2 350
(164)
2 186
(167)
1 692
(7)
—
(246)
3 458
3 818
(360)
1 The current period includes a net monetary gain of US$95m relating to hyperinflation accounting for the group’s subsidiaries in Turkey.
2 Includes US$15m foreign currency translation gains related primarily to Avito that was classified as held for sale prior to its disposal in October 2022.
3 This relates primarily to Avito which was classified as held for sale in May 2022 prior to its disposal in October 2022 as well as the OLX Autos disposal group classified as
held for sale in March 2023. Refer to note 5.
Goodwill is tested annually as at 31 December or more frequently if there is a change in circumstances that indicates that it might be
impaired. The group has allocated goodwill to various cash-generating units (CGUs). The recoverable amounts of these CGUs have been
determined based on the higher of the value in use calculations and the fair value less costs of disposal. During the current year and prior
financial year, the recoverable amounts for CGUs were determined by predominantly using value in use calculations. Value in use is based
on discounted cash flow calculations. These cash flow calculations are based on 10-year forecast information as many businesses have
monetisation timelines longer than five years.
For the year ended 31 March 2023, the impairment assessment took into consideration the increase in market interest rates and country
risk premiums and the overall business performance. The overall performance of the CGUs during the year was compared against
budgets and forecasts. The group based its cash flow calculations on 10-year budgeted and forecast information approved by senior
management and/or the various boards of directors of group companies. The 10-year budgets and forecasts consisted of cash flow
projections including macroeconomic factors and trends.
The group recognised impairment losses on goodwill of US$684m (2022: US$246m) in the current year of which US$560m relate to Stack
Overflow in the Edtech segment and US$116m relates to the OLX Autos business unit. The impairment loss of the OLX Autos business
unit is as a result of the group’s decision to exit the business and the assessment of the value that cannot be realised. The remainder
of the goodwill related to this business is transferred to the disposal group classified as held for sale. The goodwill was allocated to
the disposal group based on the relative fair values of the operations within the business (refer to note 14). Stack Overflow is a recent
acquisition; however, the increase in risk-free rates resulted in an increase in the discount rate used in the value in use calculation for this
investment. In addition, the business has not performed as expected in the current year due to challenging macroeconomic conditions.
The recoverable amount was therefore below the carrying amount and resulted in the impairment loss. The prior year impairment related
to Stack Overflow as a result of increased discount rates used in the value in use calculation for this investment.
Opening balance
Associates acquired – gross consideration
Associates disposed of
Transferred to held for sale
Loss of significant influence
Share of current year changes in OCI and net asset value
Share of equity-accounted results
Impairment
Dividends received1
Foreign currency translation effects
Partial disposal of interest in associate2
Dilution (losses)/gains3
Closing balance
Year ended
31 March
2023
US$’m
44 461
769
(1)
(5)
(743)
(1 747)
5 323
(1 728)
(5 089)
(2 119)
(2 930)
(261)
35 930
2022
US$’m
40 566
4 824
(10)
(38)
—
(2 699)
9 304
(588)
(4 426)
(249)
(2 316)
93
44 461
1 In the current year, the dividend received from Tencent amounted to US$565m cash and dividend in specie of US$4.5bn in Meituan shares (2022: US$570m cash
dividend and dividend in specie of US$3.9bn in JD.com shares).
2 Relates to partial disposal of Tencent. During the current year the group recognised a gain on partial disposal of US$7.6bn (2022: US$12.3bn).
3 The total dilution gains presented in the summary consolidated income statement relate to the group’s diluted effective interest in associates and the reclassification of
a portion of the group’s foreign currency translation reserves from the summary consolidated statement of other comprehensive income to the summary consolidated
income statement following the shareholding dilutions.
Impairment of equity-accounted investments
The group assesses whether there is an indication that its equity-accounted investments are impaired. For the year ended 31 March 2023,
the group assessment took into consideration the market capitalisation of the listed equity-accounted investments, the increase in market
interest rates and country risk premiums, and the overall business performance.
Impairment assessments for the group’s listed equity-accounted investments related to Delivery Hero and Skillsoft as a result of a decline
in the market capitalisation and the increase in country risk premiums for these investments. Impairment assessments for the group’s
unlisted equity-accounted investments related primarily to an investment in the Classifieds segment as a result of the increase in market
interest rates and the overall business performance.
The recoverable amounts of equity-accounted investments have been determined based on the higher of the value in use calculations
and the fair value less costs of disposal. During the current year and prior financial year, the recoverable amounts were determined using
value in use calculations except for Skillsoft which was determined using fair value less costs of disposal (market price) as at 31 March
2023. The recoverable amount for Skillsoft was, however, based on a value in use calculation as at 30 September 2022. As at 31 March
2023, Skillsoft was impaired to its market value due to the significant decline in the share price over time. Accordingly, the market price
is considered the supportable representation of the recoverable amount for the investment. The value in use calculation was determined
using the discounted cash flow method. The market price of Skillsoft is level 1 on the fair value hierarchy. The group used 10-year
projected cash flow models as many businesses have monetisation timelines of longer than five years.
For Delivery Hero, the value in use calculations were higher than the market price for this investment because market prices include
current market sentiment, while value in use calculations considers a longer-term horizon. The increase of the market price following
the release of the December 2022 and first quarter 2023 financial results, supports the recoverable amount determined by the value
in use calculations.
The value in use calculations for the listed equity-accounted investments were determined using the sum-of-the-parts approach. Delivery
Hero’s 10-year projected cash flow models incorporated market views and publicly available analyst projections. Skillsoft’s 10-year
projected cash flow models as at September 2022 incorporated forecast cash flow information based on the company’s latest guidance.
For the unlisted equity-accounted investments, the 10-year projected cash flow models incorporated forecast cash flow information based
on the latest management guidance provided.
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194
NASPERS
Integrated annual report 2023
o
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NASPERS
Integrated annual report 2023
195
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Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
11.
Investments in associates continued
Impairment of equity-accounted investments continued
The value in use calculations determined the equity values for the investments which took into consideration the following key
assumptions:
Revenue and expenses
Revenue and expenses in the cash flow models were based on past experience, management’s future expectations of business
performance and the latest guidance announced by Delivery Hero and Skillsoft.
Growth rates
The growth rates were consistent with publicly available information relating to long-term average growth rates for the markets in which
the equity-accounted investments operate. The annual growth rate used for revenue and expenses over the 10-year forecast period
ranged between 5% to 41% (2022: 2% to 47%) for equity-accounted investments.
Discount rates
The discount rates used reflect specific risks relating to the relevant operations and the regions in which they operate, while for certain
operations, risk adjustments are made to discount rates used when calculating the value in use. Discount rates take into account country
risk premiums and inflation differentials, as appropriate. Post-tax discount rates used ranged between 11% to 29% (2022: 10% to 20%).
Pre-tax discount rates used ranged between 13% to 35% (2022: 11% to 25%) for equity-accounted investments.
Terminal growth rates
The terminal growth rates considered the steady growth rates that would appropriately extrapolate cash flows beyond the forecast
periods once the business segment is assumed to have reached maturity. The terminal growth rates ranged between 2% to 8% (2022:
2% to 5%) for equity-accounted investments. The terminal growth rate was based on the expected growth in perpetuity in the markets
where these businesses operate.
The recoverable amounts for the above investments were lower than the respective carrying amounts. Accordingly, for the year ended
31 March 2023, an impairment loss of US$1.7bn (2022: US$584m) was recognised for equity-accounted investments of which US$997m
(recognised in the first half of the financial year) related to Delivery Hero (2022: US$nil), US$301m related to Skillsoft (2022: US$111m)
and US$431m related primarily to unlisted equity-accounted investments (2022: US$nil). For the Skillsoft impairment loss the group
recognised US$204m at September 2022 and a further US$97m as at 31 March 2023. The impairment loss for unlisted equity-accounted
investments includes US$326m related to an investment in the Classifieds segment.
At 31 March 2023, the carrying value for Delivery Hero and Skillsoft was US$3.4bn and US$123m (2022: US$4.9bn and US$383m)
respectively, while the group share in the market capitalisation of these investments was US$2.7bn and US$123m (2022: US$3.0bn and
US$302m) respectively.
Sensitivity to changes in assumptions
An adverse adjustment to any of the above key assumptions used in the value in use calculations would result in additional impairment
losses being recognised.
12.
Other investments and loans
Investments at fair value through other comprehensive income (OCI)
Investments at fair value through profit or loss
Investments at amortised cost
Related party loans
Total investments and loans
Current portion of other investments
Investments at fair value through other comprehensive income (OCI)
Non-current portion of other investments
Reconciliation of investments at fair value through other comprehensive income
Opening balance
Fair value adjustments recognised in OCI
Purchases/additional contributions1
Loss of significant influence of investments in associates
Disposals2
Foreign currency translation effects
Closing balance
Year ended
31 March
2023
US$’m
7 329
34
8
143
7 514
(4 707)
(4 707)
2 807
5 540
21
4 724
830
(3 775)
(11)
7 329
2022
US$’m
5 540
64
—
258
5 862
—
—
5 862
1 608
(509)
4 423
26
(51)
43
5 540
1 Significant movement in the current year relates to the Meituan dividend in specie received from Tencent. The prior year related to the JD.com dividend in specie received
from Tencent. Refer to note 16.
2 The significant movement in the current year relates to the disposal of the JD.com investment. Refer to note 16.
196
NASPERS
Integrated annual report 2023
13.
Commitments and contingent liabilities
Commitments relate to amounts for which the group has contracted, but that have not yet been recognised as obligations in the
statement of financial position.
Commitments
Capital expenditure
Other service commitments
Lease commitments1
Year ended
31 March
2023
US$’m
2022
US$’m
407
93
307
7
254
96
134
24
1 Lease commitments include the group’s short-term lease arrangements as well as other contractual lease agreements whose commencement date is after 31 March 2023.
Short-term lease commitments relate to leasing arrangements with lease terms of 12 months or less that are not recognised in the summary consolidated statement of
financial position.
As a global technology investor, the group’s portfolio of businesses is well diversified by sector and geography. The group operates on a
decentralised basis in numerous countries. Businesses are based in the countries where their operations, their users and consumers are.
As a result, the group’s businesses pay taxes locally, in the jurisdictions where they operate and where the group’s products and services
are consumed. Where relevant and appropriate, the group seeks advice and works with its advisers to identify and quantify contingent
tax exposures. Our current assessment of possible tax exposures, including interest and potential penalties, amounts to approximately
US$191m (2022: US$18m).
14.
Disposal groups classified as held for sale
In September 2022, the assets and liabilities of the group’s subsidiary Zoop Tecnologia e Meios de Pagamento S.A. (Zoop) were
classified as held for sale following the decision to sell the investment. The group is in negotiations with potential buyers.
In March 2023, the group announced the decision to exit the OLX Autos business unit. The disposal group that is classified as held for
sale consists of assets and liabilities of the operations that management has committed to a plan to sell. Efforts to sell the disposal group
are in progress and is expected in the 2024 financial year.
The assets and liabilities of the businesses classified as held for sale are detailed below:
Assets
Property, plant and equipment
Goodwill
Other intangible assets
Investments in associates
Inventory
Deferred taxation assets
Trade and other receivables
Cash and cash equivalents1
Liabilities
Derivative financial instruments
Deferred taxation liabilities
Long-term liabilities
Provisions
Trade payables
Accrued expenses and other current liabilities
1 Included in cash and cash equivalents is US$45m relating to restricted cash from Zoop.
31 March
2023
US$’m
2022
US$’m
26
302
29
—
32
2
164
94
649
1
13
29
2
165
66
276
1
—
—
38
—
—
—
—
39
—
—
—
—
—
—
—
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Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
15.
Equity compensation benefits
Liabilities arising from cash-settled share-based payment transactions
Reconciliation of the cash-settled share-based payment liability is as follows:
16.
Business combinations, other acquisitions and disposals
The following sets out the group’s significant transactions related to business combinations and equity-accounted investments for the year
ended 31 March 2023:
Opening balance
SAR scheme charge per the income statement1
Employment-linked put option charge per the income statement
Additions
Settlements
Modification2
Transferred to liabilities classified as held for sale3
Foreign currency translation effects
Closing balance
Less: Current portion of cash-settled share-based payment liability
Non-current portion of cash-settled share-based payment liability
Year ended
31 March
2023
US$’m
2022
US$’m
1 169
(196)
14
—
(176)
4
(37)
(50)
728
(655)
73
1 127
148
23
5
(510)
355
—
21
1 169
(985)
184
1 The decrease in the expense is as a result of the decline in the fair values of the underlying businesses that decreased the estimated cash settlement for the schemes.
2 Some of the group’s equity-settled compensation plans were prospectively modified to cash-settled due to the change in settlement policy of the share option schemes. In
the 31 March 2022 financial year, the modification relates primarily to the iFood share option scheme to cash-settled.
3 Relates primarily to Avito which was classified as held for sale in May 2022 prior to its disposal in October 2022 as well as the OLX Autos disposal group classified as held
for sale in March 2023.
Company
Classification
Acquisition of subsidiaries
Other1
Acquisition of equity-accounted
investments
Other1
Subsidiary
Associate
Additional investment in existing equity-
accounted investments
Delivery Hero SE (Delivery Hero)
Other1
Associate
Associate
Other investments
DoorDash Inc. (DoorDash)
Think & Learn Private Limited (BYJU’S)
Udemy Inc. (Udemy)
Oda Norway AS (Oda)
Meituan
Other1, 2
FVOCI
FVOCI
FVOCI
FVOCI
FVOCI
FVOCI/FVPL
Disposal/partial disposal of investments
Wolt Enterprises OY (Wolt)
JD.com
Tencent Holdings Limited (Tencent)
Think & Learn Private Limited (BYJU’S)
Udemy Inc. (Udemy)
Oda Norway AS (Oda)
Other1
FVOCI
FVOCI
Associate
Associate
Associate
Associate
Disposal of subsidiaries
Avito
Other1
Subsidiary
Subsidiary
a
b
e
f
h
g
b
c
d
e
f
h
i
Amount invested US$’m
Net
cash
paid/
(received)
Non-cash
consi-
deration
Cash in
entity
acquired/
(disposed)
Total
consi-
deration
18
18
12
12
194
99
293
—
—
—
—
—
559
559
—
(3 666)
(10 613)
—
—
—
(44)
(14 323)
(2 039)
(14)
(2 053)
—
—
—
—
288
—
288
58
578
207
45
4 523
—
5 411
(58)
—
(103)
(578)
(207)
(45)
—
(991)
—
(21)
(21)
1
1
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
(326)
(14)
(340)
19
19
12
12
482
99
581
58
578
207
45
4 523
559
5 970
(58)
(3 666)
(10 716)
(578)
(207)
(45)
(44)
(15 314)
(2 365)
(49)
(2 414)
1 ‘Other’ includes various acquisitions and disposals of subsidiaries, associates and other investments that are not individually material.
2 Includes the call options acquired for Delivery Hero shares prior to them being exercised.
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Integrated annual report 2023
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Integrated annual report 2023
199
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Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
16.
Business combinations, other acquisitions and disposals continued
Additional investment in existing equity-accounted investments
a. During the current year the group acquired an additional investment in Delivery Hero between December 2022 and March 2023,
which increased its shareholding by approximately 4% to 29.95%. The additional interest was acquired by the purchase of shares on
the market for US$194m and the purchase of a call option to acquire additional shares which was exercised in March 2023.
Other investments
b.
In June 2022, in exchange for the group’s entire interest in Wolt (a food and grocery-delivery marketplace), the group received shares
in DoorDash to the value of US$58m. DoorDash is a predominantly US-focused food, grocery and retail delivery marketplace listed
on the NYSE. The investment is not held for trading, therefore, the group accounts for this as an investment at fair value through other
comprehensive income.
Disposal/Partial disposal of investments
c.
In March 2022, the group received a special interim dividend from Tencent in the form of a distribution in specie of 131 873 028
JD.com shares. The group completed the sale of the 131 873 028 JD.com shares in June 2022, for total proceeds of US$3.7bn.
Accumulated fair value losses related to these shares of US$189m were reclassified from the valuation reserve to retained earnings
within equity as a result of this disposal.
d.
e.
f.
g.
From June 2022 to the end of March 2023, the group sold approximately 3% of Tencent’s issued share capital. The group reduced its
stake in Tencent from 29% to 26%, for total proceeds of US$10.7bn of which US$103m was receivable at 31 March 2023. The group
recognised a gain on partial disposal of US$7.6bn, including a reclassification of accumulated foreign currency translation losses of
US$155m. Proceeds from this disposal are used to fund the group’s share repurchase programme.
In September 2022, the group lost significant influence in BYJU’S as it no longer exerts significant influence over the financial and
operating policies of the entity. The group recognised a gain on loss of significant influence of the associate of US$22m, including
a reclassification of the accumulated foreign currency translation losses of US$55m. The group accounted for its 9.60% effective
interest in BYJU’S at fair value through other comprehensive income. The fair value of the BYJU’S investment, subsequent to the loss
of significant influence, is US$578m.
In September 2022, the group lost its board representation in Udemy. The group recognised a gain on loss of significant influence
of the associate of US$77m. The group accounts for its 11.78% effective interest in Udemy at fair value through other comprehensive
income. The fair value of the Udemy investment, subsequent to the loss of significant influence, is US$207m.
In November 2022, Tencent declared a special interim dividend in the form of a distribution in specie of 958 121 562 class B ordinary
shares of Meituan to its shareholders on the basis of one (1) class B ordinary share of Meituan for every 10 shares held. As a result
of this distribution the group obtained a 4% effective interest (257 460 450 class B ordinary shares) in Meituan. Meituan is a Chinese
shopping platform for locally found consumer products and retail services including entertainment, dining, delivery, travel and other
services. The investment is not held for trading; however, the group expects to sell the shares in due course. The group accounts for
this as an investment at fair value through other comprehensive income.
The group recognised a dividend receivable up until the distribution date of 24 March 2023. The dividend in specie distribution of
the investment in Meituan has reduced the investment in Tencent by US$4.5bn, representing the fair value of the investment on the
distribution date.
h.
In December 2022, the group lost its significant influence in Oda due to the loss of its board representation. The group recognised
a loss of US$68m on loss of significant influence of the associate, including a reclassification of the accumulated foreign currency
translation losses of US$14m. The group accounts for its 12.87% effective interest in Oda at fair value through other comprehensive
income. The fair value of the Oda investment subsequent to the loss of significant influence is US$45m.
Disposal of subsidiaries
i.
In October 2022, the group entered into an agreement to sell its shareholding in Avito to Kismet Capital Group (Kismet) for a
total cash consideration of US$2.4bn. Kismet is a private investment group with a track record of investing in technology and
telecommunications businesses in Russia. The group recognised a gain on disposal of the subsidiary of US$568m, including
a reclassification of the accumulated foreign currency translation gain of US$202m.
17.
Changes in non-controlling interest
The Prosus group represents a significant portion of Naspers’ NAV as it comprises the international ecommerce and internet assets,
including the investment in Tencent.
From June 2022, Prosus and Naspers began an open-ended share repurchase programme. Prosus repurchased 152 797 117 Prosus
ordinary shares N and 4 152 285 Naspers N ordinary shares. Naspers repurchased 16 320 371 Naspers N ordinary shares and sold
43 356 695 Prosus ordinary shares N. Following these transactions, and as a result of the cross-holding arrangement between Naspers
and Prosus, the group’s economic interest in Prosus is 43.54% (2022: 42.29%). Accordingly, the 56.46% (2022: 57.71%) interest in Prosus
held by free-float shareholders represents a significant non-controlling interest of the group.
The group’s sale and repurchase of Prosus ordinary shares N impacted the Prosus free-float economic interest in the group. The
transactions were accounted for as equity transactions because the change in economic interest had no impact on the control structure
of the group. The change in the Prosus free-float economic interest resulted in a US$6.6bn decrease in non-controlling interest and a
US$741m decrease in the ‘Existing control business combination reserve’ in equity.
The Prosus group prepares its own consolidated financial results, which are reported to its shareholders in accordance with its listing
obligations on Euronext Amsterdam. More information on Prosus’ results is available at https://www.prosus.com.
In August 2022, the group entered into an agreement through its subsidiary MIH Movile Holdings B.V. (Movile) to acquire the remaining
33.3% stake in iFood Holdings B.V. (iFood) and IF-JE Holdings B.V., from non-controlling shareholder Just Eat Holding Limited (Just Eat) for
€1.5bn in cash, plus a contingent consideration of up to a maximum of €300m at a future date. The transaction was approved by Just
Eat shareholders in November 2022. This agreement represents a contractual obligation to acquire shares from non-controlling interest.
The group recognised US$1.6bn in ‘Other current liabilities’ at inception of this agreement consisting of the cash and the fair value of the
contingent consideration. The liability was raised from the ‘Existing control business combination reserve’ in equity prior to the transfer of
the risks and rewards of ownership of these shares.
In November 2022, the shares were acquired from the non-controlling shareholders for the cash consideration of US$1.5bn resulting
in part settlement of the liability raised. At 31 March 2023, the fair value of the contingent consideration to be settled at a future date
amounted to US$88m. The group derecognised US$68m of non-controlling interest.
The summarised financial information contained below relates to subsidiaries of the group that are considered to have significant
non-controlling interests:
Prosus N.V.
Summarised consolidated statement of financial position
Non-current assets
Current assets
Total assets
Non-current liabilities
Current liabilities
Total liabilities
Accumulated non-controlling interests
Summarised consolidated income statement
Revenue from continuing operations
Net profit for the year attributable to equity holders
Other comprehensive loss attributable to equity holders
Total comprehensive income attributable to equity holders
Total comprehensive loss attributable to non-controlling interests
Dividends paid to non-controlling interests
Dividends declared by subsidiaries
Summarised consolidated statement of cash flows
Cash flows utilised in operating activities
Cash flows generated from investing activities
Cash flows (utilised in)/generated from financing activities
March
2023
US$’m
41 707
23 371
65 078
16 048
4 405
20 453
25 613
5 765
10 112
(3 542)
6 570
(98)
(102)
191
(120)
12 643
(12 451)
March
2022
US$’m
56 073
15 265
71 338
16 402
4 413
20 815
29 516
5 220
18 733
(3 167)
15 566
(83)
(134)
238
(605)
4 392
2 403
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Integrated annual report 2023
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Integrated annual report 2023
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Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
18.
Financial instruments
The group’s activities expose it to a variety of financial risks such as market risk (including currency risk, fair value interest rate risk, cash
flow interest rate risk and price risk), credit risk and liquidity risk.
The summary consolidated financial statements do not include all financial risk management information and disclosures required in the
annual consolidated financial statements and should be read in conjunction with the group’s risk management information disclosed in note
42 of the consolidated financial statements for the year ended 31 March 2023. There have been no material changes in the group’s credit,
liquidity, market risks or key inputs used in measuring fair value since 31 March 2022.
The fair values of the group’s financial instruments that are measured at fair value at each financial year end presented, are categorised
as follows:
Fair value measurements at 31 March 2023 using:
Quoted
prices in
active
markets
for
identical
assets or
liabilities
(level 1)
US$’m
6 044
4
—
—
—
—
Carrying
value
US$’m
7 329
34
5
447
2
109
Significant
other
observable
inputs
(level 2)
US$’m
Significant
unobservable
inputs
(level 3)
US$’m
—
—
5
447
2
—
1 285
30
—
—
—
109
Assets
Financial assets at fair value through other comprehensive income
Financial assets at fair value through profit or loss
Forward exchange contracts
Cash and cash equivalents1
Liabilities
Forward exchange contracts
Earn-out obligations
1 Relates to short-term bank deposits which are money market funds held with major banking groups and high-quality institutions that have AAA money market fund credit
ratings from internationally recognised ratings agencies.
Fair value measurements at 31 March 2022 using:
Quoted
prices in
active
markets
for
identical
assets or
liabilities
(level 1)
US$’m
4 767
19
—
—
—
—
—
—
—
Carrying
value
US$’m
5 540
64
928
27
11
2
18
2
20
Significant
other
observable
inputs
(level 2)
US$’m
Significant
unobservable
inputs
(level 3)
US$’m
—
—
928
27
—
2
18
—
—
773
45
—
—
11
—
—
2
20
Assets
Financial assets at fair value through other comprehensive income
Financial assets at fair value through profit or loss
Cash and cash equivalents1
Forward exchange contracts
Derivatives contained in lease agreements
Cross-currency interest rate swap
Liabilities
Forward exchange contracts
Derivatives contained in lease agreements
Earn-out obligations
1 Relates to short-term bank deposits which are money market investments held with major banking groups and high-quality institutions that have AAA money market fund
credit ratings from internationally recognised ratings agencies.
There was a transfer of US$nil (2022: US$4m) from level 2 to level 1 and a transfer of US$1m (2022: US$10m) from level 3 to level 1.
There was another transfer of US$622m (2022: US$nil) to level 3 due to investments in associates that lost significant influence during the
current year. There were no significant changes to the valuation techniques and inputs used in measuring fair value.
202
NASPERS
Integrated annual report 2023
18.
Financial instruments continued
Valuation techniques and key inputs used to measure significant level 2 and level 3 fair values
Level 2 fair value measurements
Forward exchange contracts – in measuring the fair value of forward exchange contracts, the group makes use of market observable
quotes of forward foreign exchange rates on instruments that have a maturity similar to the maturity profile of the group’s forward
exchange contracts. Key inputs used in measuring the fair value of forward exchange contracts include: current spot exchange rates,
market forward exchange rates and the term of the group’s forward exchange contracts.
Cross-currency interest rate swap – the fair value of the group’s interest rate and cross-currency swaps is determined through the use of
discounted cash flow techniques using only market observable information. Key inputs used in measuring the fair value of interest rate
and cross-currency swaps include: spot market interest rates, contractually fixed interest rates, foreign exchange rates, counterparty credit
spreads, notional amounts on which interest rate swaps are based, payment intervals, risk-free interest rates as well as the duration of
the relevant interest rate and cross-currency swap arrangement.
Cash and cash equivalents – relate to short-term bank deposits which are money market funds held with major banking groups and high-
quality institutions that have AAA money market fund credit ratings from internationally recognised rating agencies. The fair value of these
deposits is determined by the amounts deposited and the gains or losses generated by the funds as detailed in the statements provided
by these institutions. The gains/losses are recognised in the income statement.
Financial assets at fair value – relate to a contractual right to receive shares or cash. The fair value is based on a listed share price on
the date the transaction was entered into.
Level 3 fair value measurements
Financial assets at fair value – relate predominantly to unlisted equity investments. The fair value of unlisted equity investments is based
on the most recent funding transactions for these investments, a discounted cash flow calculation (DCF), or a weighted-income and
market approach using a discounted cash flow calculation and market multiples. The unlisted equity investments based on a DCF or
weighted-income and market approach relate to investments in the Edtech segment. The fair value of these unlisted equity investments
is based on the following unobservable inputs:
Revenue growth rates and EBITDA margins
Revenue growth rates and EBITDA margins are based on past experience and management’s future expectations of business
performance.
Long-term growth rate
The long-term growth rate is based on expectations for inflation in the regions in which the business operates – the data is sourced
from publicly available information. The long-term growth rate is spread over a 10-year forecast period. The annual growth rate used for
revenue and expenses over the 10-year forecast period ranged between 2% to 6%.
Discount rate
The discount rate used is a weighted average cost of capital. The weighted average cost of capital takes into account the cost of equity
and cost of debt. The cost of equity is based on a risk-free rate adjusted for specific risks such as a country risk and equity risk premium.
The cost of debt is based on the pre-tax cost of debt adjusted with a sovereign spread premium net of tax. Discount rates used ranged
between 12% to 15%.
Terminal growth rate
The terminal growth rate considered the steady growth rates that would appropriately extrapolate cash flows beyond the forecast periods
once the business segment has assumed to reach maturity. The terminal value assumes that free cash flow in the terminal period grows
at the long-term growth rate and is then calculated using the Gordon Growth Model. Terminal growth rates used ranged between
1% to 5%.
For our largest investment in the Edtech segment, a 1% increase in the discount rates would result in a decrease in the valuation of this
investment by US$53m and a 1% decrease in the discount rates would result in an increase in the valuation of this investment by US$60m.
Derivatives contained in lease agreements – relate to foreign currency forwards embedded in lease contracts. The fair value of the
derivatives is based on forward foreign exchange rates that have a maturity similar to the lease contracts and the contractually specified
lease payments.
Earn-out obligations – relate to amounts that are payable to the former owners of businesses now controlled by the group, provided that
contractually stipulated post-combination performance criteria are met. These are remeasured to fair value at the end of each reporting
period. Key inputs used in measuring fair value include: 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.
Instruments not measured at fair value for which fair value is disclosed
Level 2 – the fair values of the publicly traded bonds have been determined with reference to the listed prices of the instruments at the
reporting date. As the instruments are not actively traded, this is a level 2 disclosure.
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Integrated annual report 2023
203
Notes to the summary consolidated financial statements continued
for the year ended 31 March 2023
18.
Financial instruments continued
The following table shows a reconciliation of the group’s level 3 financial instruments:
Balance at 1 April 2022
Additions
Total (losses)/gains recognised in the income statement
Total losses recognised in other comprehensive income
Settlements/disposals
Transfers from investments in associates
Transfer to held for sale
Foreign currency translation effects
Balance at 31 March 2023
Balance at 1 April 2021
Additions
Total gains/(losses) recognised in the income statement
Total gains recognised in other comprehensive income
Settlements/disposals
Transfers
Foreign currency translation effects
Balance at 31 March 2022
1 Financial assets at fair value through other comprehensive income.
2 Financial assets at fair value through profit or loss.
31 March 2023
Financial
assets at
FVOCI1
US$’m
Financial
assets at
FVPL2
US$’m
Earn-out
obli-
gations
US$’m
Derivatives
embedded
in leases
US$’m
773
38
—
(80)
(65)
622
—
(3)
1 285
45
41
(12)
—
(35)
—
(9)
—
30
(20)
(96)
7
—
—
—
—
—
(109)
9
—
—
—
(9)
—
—
—
—
31 March 2022
Financial
assets at
FVOCI1
US$’m
Financial
assets at
FVPL2
US$’m
Earn-out
obli-
gations
US$’m
Derivatives
embedded
in leases
US$’m
139
582
—
107
(46)
(10)
1
773
16
23
6
—
—
—
—
45
(13)
—
(9)
—
1
—
1
(20)
7
—
2
—
—
—
—
9
The carrying value of financial instruments are a reasonable approximation of their fair values, except for the publicly traded bonds
detailed below:
Financial liabilities
Publicly traded bonds
31 March 2023
31 March 2022
Carrying
value
US$’m
Fair
value
US$’m
Carrying
value
US$’m
Fair
value
US$’m
15 377
12 009
15 492
13 056
The fair values of the publicly traded bonds have been determined with reference to the listed prices of the instruments as at the end of
the reporting period. The fair values of the publicly traded bonds are level 2 financial instruments. The publicly traded bonds are listed
on the Irish Stock Exchange (Euronext Dublin).
19.
Related party transactions and balances
The group entered into various related party transactions in the ordinary course of business with a number of related parties, including
equity-accounted investments. Transactions that are eliminated on consolidation as well as gains or losses eliminated through the
application of the equity method are not included. The transactions and balances with related parties are summarised below:
Sale of goods and services to related parties1
Skillsoft Corp.
EMPG Holdings Limited
Bom Negocio Atividades de Internet Ltda (OLX Brasil)
Various other related parties
Year ended
31 March
2023
US$’m
2022
US$’m
8
—
28
2
38
34
12
14
—
60
1 The group receives revenue from a number of its related parties in connection with service agreements. The nature of these related party relationships are that of equity-
accounted investments.
The balances of advances, deposits, receivables and payables between the group and related parties are as follows:
Loans and receivables1
Bom Negocio Atividades de Internet Ltda (OLX Brasil)2
Inversiones CMR S.A.S.
GoodGuyz Investments B.V.
Silvergate Capital Corporation
Various other related parties
Less: Allowance for impairment of loans and receivables3
Total related party receivables
Less: Non-current portion of related party receivables
Current portion of related party receivables
Year ended
31 March
2023
US$’m
2022
US$’m
150
1
6
2
17
—
176
(143)
33
219
21
6
4
6
—
256
(243)
13
1 The group provides services and loan funding to a number of its related parties. The nature of these related party relationships is that of equity-accounted investments.
2 During the current year a portion of the loan was capitalised to the investment in joint venture. The loan is repayable by October 2035 and is interest-free until April 2022.
Subsequently, interest is charged annually at SELIC+2%.
3 Impairment allowance for related parties is based on a 12-month expected credit loss model and was not material.
Purchases of goods and services from related parties amounted to US$3m (2022: US$2m) and amounts payable to related parties
amounted to US$6m (2022: US$6m). These amounts are not considered significant and relate to various related parties, most of which
are equity-accounted investments of the group.
20.
Events after the reporting period
As part of the share repurchase programme announced in June 2022, Prosus acquired 27 741 167 Prosus ordinary shares N for
US$2.02bn and Naspers acquired 5 480 549 Naspers N ordinary shares for US$940m between April and 22 June 2023. Furthermore,
Naspers disposed of 10 591 976 Prosus ordinary shares N for US$766m between April and 22 June 2023. The group will account for
this transaction in the same manner that it was accounted for in the year ended 31 March 2023.
The group sold 46 789 700 shares of Tencent Holdings Limited (Tencent) between April and 22 June 2023 yielding US$2.05bn in
proceeds. An accurate estimate for the gain on disposal of these shares cannot be made until the corresponding equity-accounted results
for the period have been finalised.
In June 2023, the group received the requisite approval from the South African Reserve Bank for a proposed transaction in terms of
which the crossholding between Naspers and Prosus will be removed. The implementation of the proposed transaction will enable
the continuation of the share repurchase programme at the Naspers level. The proposed transaction is also intended to remove
the complexity created by the crossholding between Naspers and Prosus while keeping the Naspers and Prosus free-float effective
economic interests the same as they were prior to its implementation. This will be achieved through aligning the legal ownership in
Prosus with the current respective free-float effective economic interests. The implementation of the proposed transaction is subject to
the requisite regulatory and Naspers and Prosus shareholder and final board approvals being obtained.
204
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205
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Other information to the summary
consolidated financial statements
for the year ended 31 March 2023
A.
A.1
Non-IFRS financial measures and alternative performance measures
Core headline earnings
Core headline earnings, a non-IFRS performance measure, represent headline earnings for the period, excluding certain non-operating
items. Specifically, headline earnings are adjusted for the following items to derive core headline earnings: (i) equity-settled share-based
payment expenses on transactions where there is no cash cost to the group. These include those relating to share-based incentive
awards settled by issuing treasury shares as well as certain share-based payment expenses that are deemed to arise on shareholder
transactions; (ii) subsequent fair value remeasurement of cash-settled share-based incentive expenses; (iii) cash-settled share-based
compensation expenses deemed to arise from shareholder transactions by virtue of employment; (iv) deferred taxation income
recognised on the first-time recognition of deferred tax assets as this generally relates to multiple prior periods and distorts current
period performance; (v) fair value adjustments on financial and unrealised currency translation differences, as these items obscure
our underlying operating performance; (vi) once-off gains and losses (including acquisition-related costs) resulting from acquisitions
and disposals of businesses as these items relate to changes in our composition and are not reflective of our underlying operating
performance; and (vii) the amortisation of intangible assets recognised in business combinations and acquisitions. These adjustments
are made to the earnings of businesses controlled by the group as well as our share of earnings of associates and joint ventures, to the
extent that the information is available.
Reconciliation of core headline earnings
Headline earnings from continuing operations (refer to note 6)
Adjusted for:
Equity-settled share-based payment expenses
Remeasurement of cash-settled share-based incentive expenses
Tax adjustment
Amortisation of other intangible assets
Fair value adjustments and currency translation differences
Retention option expense
Transaction-related costs
Core headline earnings from continuing operations
Per share information for the year
Core headline earnings per ordinary share (US cents)
Diluted core headline earnings per ordinary share (US cents)1
Net number of ordinary shares issued (’000)
Weighted average for the year
Diluted weighted average
Year ended
31 March
2023
US$’m
2022
US$’m
249
1 586
629
(130)
6
290
(37)
10
39
777
24
—
363
(737)
—
25
1 056
2 038
507
427
703
622
208 404
208 492
289 777
290 583
1 The diluted core headline earnings per share include a decrease of US$166.0m (2022: US$230.0m) relating to the future dilutive impact of potential ordinary shares
issued by equity-accounted investees.
A.
A.1
Non-IFRS financial measures and alternative performance measures continued
Core headline earnings continued
Reconciliation of core headline earnings continued
Headline earnings from discontinued operations (refer to note 6)
Adjusted for:
Remeasurement of cash-settled share-based incentive expenses
Amortisation of other intangible assets
Fair value adjustments and currency translation differences
Retention option expense
Core headline earnings from discontinued operations
Per share information for the year
Core headline earnings per ordinary share (US cents)
Diluted core headline earnings per ordinary share (US cents)1
Net number of ordinary shares issued (’000)
Weighted average for the year
Diluted weighted average
Year ended
31 March
2023
US$’m
2022
US$’m
—
(17)
4
6
—
(7)
(3)
(3)
35
(8)
28
(6)
(6)
43
15
15
208 404
208 492
289 777
290 583
1 The diluted core headline earnings per share include a decrease of nil (2022: nil) relating to the future dilutive impact of potential ordinary shares issued by equity-
accounted investees.
Equity-accounted results
The group’s equity-accounted investments contributed to the summary consolidated report as follows:
Share of equity-accounted results from continuing operations
Sale of assets
Gains on acquisitions and disposals
Impairment of investments
Contribution to headline earnings from continuing operations
Amortisation of other intangible assets
Equity-settled share-based payment expenses
Fair value adjustments and currency translation differences
Acquisition-related costs
Contribution to core headline earnings from continuing operations
Tencent
VK
Delivery Hero
Other
Attributable to:
Equity holders of the group
Non-controlling interest
Year ended
31 March
2023
US$’m
5 176
5
(5 875)
1 919
1 225
641
1 440
(75)
62
3 293
4 326
—
(374)
(659)
1 418
1 875
2022
US$’m
9 255
—
(6 269)
1 092
4 078
680
1 512
(1 760)
42
4 552
5 413
(51)
(409)
(401)
2 515
2 037
The group applies an appropriate lag period of not more than three months in reporting the results of equity-accounted investments.
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consolidated financial statements continued
for the year ended 31 March 2023
A.
A.2
Non-IFRS financial measures and alternative performance measures continued
Growth in local currency, excluding acquisitions and disposals
The group applies certain adjustments to segmental revenue and trading profit reported in the summary consolidated financial
statements to present the growth in such metrics in local currency and excluding the effects of changes in the composition of the group.
Such underlying adjustments provide a view of the company’s underlying financial performance that management believes is more
comparable between periods by removing the impact of changes in foreign exchange rates, hyperinflation adjustments and changes in
the composition of the group on its results. Such adjustments are referred to herein as ‘growth in local currency, excluding acquisitions
and disposals’. The group applies the following methodology in calculating growth in local currency, excluding acquisitions and disposals:
» Foreign exchange/constant currency adjustments have been calculated by adjusting the current period’s results to the prior period’s
average foreign exchange rates, determined as the average of the monthly exchange rates for that period. The local currency financial
information quoted is calculated as the constant currency results, arrived at using the methodology outlined above, compared to the
prior period’s actual IFRS results. The relevant average exchange rates (relative to the US dollar) used for the group’s most significant
functional currencies, were:
Currency (1FC = US$)
South African rand (ZAR)
Euro (EUR)
Chinese yuan renminbi (RMB)
Brazilian real (BRL)
Indian rupee (INR)
Polish zloty (PLN)
British pound sterling (GBP)
Turkish lira (YTL)
Romanian lei (RON)
Hungarian forint (HUF)
Year ended
31 March
2023
2022
0.0583
1.0415
0.1453
0.1943
0.0124
0.2213
1.2036
0.0557
0.2114
0.0026
0.0670
1.1586
0.1562
0.1891
0.0134
0.2525
1.3620
0.0927
0.2346
0.0032
» Adjustments made for changes in the composition of the group relate to acquisitions, mergers and disposals of subsidiaries and
equity-accounted investments, as well as to changes in the group’s shareholding in its equity-accounted investments. For acquisitions,
adjustments are made to remove the revenue and trading profit/(loss) of the acquired entity from the current reporting period and, in
subsequent reporting periods, to ensure that the current reporting period and the comparative reporting period contain revenue and
trading profit/(loss) information relating to the same number of months. For mergers, adjustments are made to include a portion of
the prior period’s revenue and trading profit/(loss) of the entity acquired as a result of a merger. For disposals, adjustments are made
to remove the revenue and trading profit/(loss) of the disposed entity from the previous reporting period to the extent that there is no
comparable revenue or trading profit/(loss) information in the current period and, in subsequent reporting periods, to ensure that the
previous reporting period does not contain revenue and trading profit/(loss) information relating to the disposed business.
A.
A.2
Non-IFRS financial measures and alternative performance measures continued
Growth in local currency, excluding acquisitions and disposals continued
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:
For the year ended 31 March 2023
Transaction
Dilution of the group’s interest in Tencent
Loss of control of the group’s interest in VK
Disposal of the group’s interest in AasaanJobs
Dilution and subsequent step down of the group’s interest in Selency
Acquisition of the group’s interest in Oda
Acquisition of the group’s interest in Flink
Acquisition of the group’s interest in Flip
Acquisition of the group’s interest in Delivery Solutions
Increase in the group’s interest in Delivery Hero
Acquisition of the group’s interest in Eruditus together with the impact of change in revenue recognition
Acquisition of the group’s interest in GoodHabitz
Acquisition of the group’s interest in Platzi
Acquisition of the group’s interest in Stack Overflow
Acquisition of the group’s interest in Skillsoft
Dilution of the group’s interest in Udemy together with the impact of change in revenue recognition
Increase in the group’s interest in ElasticRun together with the impact of change in revenue recognition
Increase in the group’s interest in Meesho
Increase in the group’s interest in DeHaat
Acquisition of the group’s interest in PharmEasy
Acquisition of the group’s interest in Aruna
Acquisition of the group’s interest in 99 Minutos
Acquisition of the group’s interest in Alwans
Acquisition of the group’s interest in Facily
Acquisition of the group’s interest in Captain Fresh
Acquisition of the group’s interest in Sangvhi Beauty
Acquisition of the group’s interest in Bux
Basis of
accounting
Reportable
segment
Acquisition/
Disposal
Associate
Associate
Social and internet
platforms
Social and internet
platforms
Subsidiary
Ecommerce
Subsidiary/
Associate
Associate
Associate
Associate
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Subsidiary
Ecommerce
Associate
Associate
Ecommerce
Ecommerce
Subsidiary
Ecommerce
Associate
Ecommerce
Subsidiary
Ecommerce
Associate
Associate
Associate
Associate
Associate
Associate
Associate
Associate
Associate
Associate
Associate
Associate
Associate
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Ecommerce
Disposal
Disposal
Disposal
Disposal
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Disposal
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
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209
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Other information to the summary
consolidated financial statements continued
for the year ended 31 March 2023
A.
A.2
Non-IFRS financial measures and alternative performance measures continued
Growth in local currency, excluding acquisitions and disposals continued
For the year ended 31 March 2023
Transaction
Dilution of the group’s interest in Swiggy
Dilution of the group’s interest in Remitly
Dilution and lag period catch-up adjustment following the subsequent loss of significant influence of the
group’s interest in BYJU’S
Disposal of the group’s interest in PlayKids
Disposal of the group’s interest in Codecademy
Acquisition of the group’s interest in ShareBite
Acquisition of the group’s interest in A55
Acquisition of the group’s interest in Frexco
Acquisition of the group’s interest in Anota
Acquisition of the impact of the fair value adjustment on cash-settled schemes in Eruditus
Acquisition of the impact of the hyper-inflation adjustment in Classifieds Autos
Basis of
accounting
Reportable
segment
Acquisition/
Disposal
Associate
Associate
Ecommerce
Ecommerce
Disposal
Disposal
Associate
Ecommerce
Disposal/Acquisition
Subsidiary
Ecommerce
Associate
Ecommerce
Associate
Ecommerce
Associate
Ecommerce
Associate
Ecommerce
Subsidiary
Ecommerce
Associate
Ecommerce
Subsidiary
Ecommerce
Disposal
Disposal
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Foreign currency
adjustment
The net adjustment made for all acquisitions and disposals on continuing operations that took place during the year ended
31 March 2023 amounted to a negative adjustment of US$1 393m on revenue and a negative adjustment of US$482m on trading profit.
The adjustments to the amounts, reported in terms of IFRS, that have been made in arriving at the pro forma financial information are
presented in the table below:
Year ended 31 March
2022
A
IFRS 81
US$’m
2023
B
Group
composition
disposal
adjustment
US$’m
2023
C
Group
composition
acquisition
adjustment
US$’m
2023
D
Foreign
currency
adjustment
US$’m
2023
E
Local
currency
growth
US$’m
2023
F2
2023
G3
2023
H4
Local
currency
growth
% change
IFRS 81
US$’m
IFRS 8
% change
9 005
1 324
2 992
796
425
3 086
382
25 794
25 261
533
257
—
—
(197)
(18)
(58)
(6)
(72)
(1)
(42)
(1 638)
(1 105)
(533)
(7)
—
—
35 056
(1 842)
1 651
(279)
449
1
208
2
135
21
82
—
—
—
—
—
—
449
1
(1 039)
(276)
(238)
(144)
(6)
(347)
(28)
(1 649)
(1 649)
—
(32)
—
(1)
10 754
2 536
1 575
544
4 203
1 299
1 052
404
545
63
2 761
2
618
224
(238) 22 269
(238) 22 269
—
217
—
(3)
—
(1)
—
(2)
(2 721)
2 295
33 237
48
205
1 626
36 707
(2 121)
450
(2 673)
2 500
34 863
29
42
44
51
18
—
66
(1)
(1)
—
—
—
<(100)
7
15
7
19
19
40
32
28
(11)
62
(14)
(12)
(100)
(16)
—
<(100)
(5)
(2)
(5)
Continuing operations
Revenue
Ecommerce
Classifieds5, 6
Food Delivery
Payments and Fintech
Edtech
Etail
Other
Social and internet platforms
Tencent
VK7
Media
Corporate segment
Intersegmental
Economic interest from continuing operations
Discontinued operations5, 6
Group economic interest
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 From 1 April 2022, following the separation from OLX Group, the CODM reviewed the financial results of Avito separately. Subsequent to the group’s decision to exit
this Russian business, Avito was presented as a discontinued operation up until the date of disposal.
6 From 1 March 2023, following the group’s decision to exit the OLX Autos business unit, its operations classified as held for sale and those that have been closed by
31 March 2023 were presented as a discontinued operation. The OLX Autos business unit is a separate major line of business both in terms of the distinct nature of
the business and its contribution to the operational performance of the group.
7 During the year ended 31 March 2022, the group lost significant influence in VK and the group accounted for its investment at fair value through other comprehensive
income. In November 2022, the group signed an agreement with VK to renounce all VK shares and shareholder rights for no consideration.
210
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Integrated annual report 2023
A.
A.2
Non-IFRS financial measures and alternative performance measures continued
Growth in local currency, excluding acquisitions and disposals continued
The adjustments to the amounts, reported in terms of IFRS, that have been made in arriving at the pro forma financial information are
presented in the table below:
Year ended 31 March
2022
A
IFRS 81
US$’m
2023
B
Group
composition
disposal
adjustment
US$’m
2023
C
Group
composition
acquisition
adjustment
US$’m
2023
D
Foreign
currency
adjustment
US$’m
2023
E
Local
currency
growth
US$’m
2023
F2
2023
G3
2023
H4
Local
currency
growth
% change
IFRS 81
US$’m
IFRS 8
% change
(1 215)
(70)
(724)
(60)
(117)
(42)
(202)
6 319
6 273
46
17
(217)
4 904
95
4 999
41
(4)
23
—
16
—
6
(292)
(246)
(46)
—
—
(251)
(42)
(293)
(231)
—
(78)
(2)
(106)
(5)
(40)
—
—
—
—
—
(231)
24
52
(5)
48
(11)
4
8
8
(381)
(381)
—
(1)
7
(323)
40
(181)
(77)
82
(43)
(55)
(46)
(42)
(561)
(561)
—
(9)
—
(751)
(91)
(1 534)
(156)
(649)
(116)
(258)
(85)
(270)
5 085
5 085
—
7
(210)
3 348
(15)
<(100)
12
(72)
(54)
<(100)
(21)
(9)
(9)
—
(53)
—
(16)
26
<(100)
(207)
(283)
(842)
3 374
(18)
(26)
<(100)
10
(93)
<(100)
<(100)
(34)
(20)
(19)
(100)
(59)
3
(32)
(73)
(33)
Continuing operations
Trading profit
Ecommerce
Classifieds5, 6
Food Delivery
Payments and Fintech
Edtech
Etail
Other
Social and internet platforms
Tencent
VK7
Media
Corporate segment
Economic interest from continuing operations
Discontinued operations5, 6
Group economic interest
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 From 1 April 2022, following the separation from OLX Group, the CODM reviewed the financial results of Avito separately. Subsequent to the group’s decision to exit
this Russian business, Avito was presented as a discontinued operation up until the date of disposal.
6 From 1 March 2023, following the group’s decision to exit the OLX Autos business unit, its operations classified as held for sale and those that have been closed by
31 March 2023 were presented as a discontinued operation. The OLX Autos business unit is a separate major line of business both in terms of the distinct nature of
the business and its contribution to the operational performance of the group.
7 During the year ended 31 March 2022, the group lost significant influence in VK and the group accounted for its investment at fair value through other comprehensive
income. In November 2022, the group signed an agreement with VK to renounce all VK shares and shareholder rights for no consideration.
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NASPERS
Integrated annual report 2023
211
Report on the assurance engagement on the
compilation of pro forma financial information
Report on the Assurance Engagement on the Compilation of Pro Forma Financial Information
included in the Naspers summary consolidated financial statements for the year ended
31 March 2023
We have completed our assurance engagement to report on the compilation of the pro forma financial information of Naspers
Limited (the “Company”) by the directors. The pro forma financial information, as set out in notes A.1 and A.2 of the Naspers
summary consolidated financial statements, consists of Pro Forma information for the year ending 31 March 2023 in order to
separately present a measure of Core headline earnings, a reconciliation between Headline earnings and Core headline
earnings and the contribution of equity accounted investments to Core headline earnings (Core headline earnings measures) as
at 31 March 2023 and to present the impact of foreign currency, excluding current period acquisitions and disposals, to reflect the
constant currency with the prior period (Organic growth figures) on certain earnings measures as at 31 March 2023. The
applicable criteria on the basis of which the directors have compiled the pro forma financial information are specified in the JSE
Limited (JSE) Listings Requirements and described in notes A.1 and A.2 of the Naspers summary consolidated financial
statements as at 31 March 2023.
The pro forma financial information has been compiled by the directors in order to separately present a measure of Core
headline earnings, a reconciliation between Headline earnings and Core headline earnings and the contribution of equity
accounted investments to Core headline earnings (Core headline earnings measures) as at 31 March 2023 and to present the
impact of foreign currency, excluding current period acquisitions and disposals, to reflect the constant currency with the prior
period (Organic growth figures) on certain earnings measures as at 31 March 2023. As part of this process, information about the
Company’s financial performance has been extracted by the directors from the summary consolidated financial statements for
the year ended 31 March 2023, on which an audit report has been published.
Directors’ responsibility
The directors of the Company are responsible for compiling the pro forma financial information on the basis of the applicable
criteria specified in the JSE Listings Requirements and described in notes A.1. and A.2 of the Naspers summary consolidated
financial statements for the year ended 31 March 2023.
Our independence and quality management
We have complied with the independence and other ethical requirements of the Code of Professional Conduct for Registered
Auditors, issued by the Independent Regulatory Board for Auditors’ (IRBA Code), which is founded on fundamental principles of
integrity, objectivity, professional competence and due care, confidentiality and professional behaviour. The IRBA Code is
consistent with the corresponding sections of the International Ethics Standards Board for Accountants’ International Code of Ethics
for Professional Accountants (including International Independence Standards).
The firm applies International Standard on Quality Management 1, Quality Management for Firms that Perform Audits or Reviews
of Financial Statements, or Other Assurance or Related Services Engagements, which requires the firm to design, implement and
operate a system of quality management, including policies or procedures regarding compliance with ethical requirements,
professional standards and applicable legal and regulatory requirements.
Reporting accountant’s responsibility
Our responsibility is to express an opinion about whether the pro forma financial information has been compiled, in all material
respects, by the directors on the basis of the applicable criteria specified in the JSE Listings Requirements and described in
notes A.1 and A.2 of the Naspers summary consolidated financial statements as at 31 March 2023 based on our
procedures performed.
We conducted our engagement in accordance with the International Standard on Assurance Engagements (ISAE) 3420, Assurance
Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus issued by the
International Auditing and Assurance Standards Board. This standard requires that we plan and perform our procedures to obtain
reasonable assurance about whether the pro forma financial information has been compiled, in all material respects, on the
basis specified in the JSE Listings Requirements.
212
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For purposes of this engagement, we are not responsible for updating or reissuing any reports or opinions on any historical
financial information used in compiling the pro forma financial information, nor have we, in the course of this engagement,
performed an audit or review of the financial information used in compiling the pro forma financial information.
The purpose of pro forma financial information is solely to separately present a measure of Core headline earnings, a
reconciliation between Headline earnings and Core headline earnings and the contribution of equity accounted investments to
Core headline earnings (Core headline earnings measures) as at 31 March 2023 and to present the impact of foreign currency,
excluding current period acquisitions and disposals, to reflect the constant currency with the prior period (Organic growth figures)
on certain earnings measures as at 31 March 2023. Accordingly, we do not provide any assurance that the actual financial
outcome of the event or transaction would have been as presented.
A reasonable assurance engagement to report on whether the pro forma financial information has been compiled, in all material
respects, on the basis of the applicable criteria involves performing procedures to assess whether the applicable criteria used by
the directors in the compilation of the pro forma financial information provide a reasonable basis for presenting the significant
effects directly attributable to the event or transaction, and to obtain sufficient appropriate evidence about whether:
» The related pro forma adjustments give appropriate effect to those criteria; and
» The pro forma financial information reflects the proper application of those adjustments to the unadjusted financial information.
The procedures selected depend on our judgement, having regard to our understanding of the nature of the Company, the
event or transaction in respect of which the pro forma financial information has been compiled, and other relevant
engagement circumstances.
Our engagement also involves evaluating the overall presentation of the pro forma financial information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Opinion
In our opinion, the pro forma financial information has been compiled, in all material respects, on the basis of the applicable
criteria specified by the JSE Listings Requirements and described in notes A.1 and A.2 of the Naspers summary consolidated
financial statements for the year ended 31 March 2023.
PricewaterhouseCoopers Inc.
Director: Vicki Myburgh
Registered Auditor
Johannesburg, South Africa
26 June 2023
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Integrated annual report 2023
213
Romania
Highlights
2021
Mobile subscriptions
23 million*
Internet users
78%*
2022
Unemployment rate
5.5%
GDP
4.7%
Inflation
12%
2023
Population
>20 million
Naspers offers
» Ecosystem of complementary businesses
on top of vibrant eMAG Romania
platform: From etail core, extended into
fashion (Fashion Days); food delivery
(Tazz); grocery (Freshful); and financial
services (HeyBlu). Overarching Genius
loyalty programme, underpinning
Sameday delivery service.
» ESG:
• An easybox order generates up to 95%
less CO2 than delivery to a customer’s
home – over 50% of orders through
easybox.
• Promoting circular economy: Buy
‘second-chance’ products, buyback
voucher programme for used home
appliances with free pick-up, repair
service, sale of refurbished second-
hand mobile phones destined for
landfill.
• 42 companies have signed eMAG’s
environmental pledge (angajament
pentru mediu) – the first initiative
to unite the Romanian business
community behind the common goal of
limiting the rise in global temperatures.
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215
* Estimated.
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Administration and corporate information
Analysis of shareholders and shareholders’ diary
Company secretary
L Bagwandeen
Suite 15, Third Floor
Oxford & Glenhove
116 Oxford Road
Houghton Estate
Johannesburg 2196
South Africa
cosec@naspers.com
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
Website: www.naspers.com
Registration number
1925/001431/06
Incorporated in the Republic of South Africa
JSE share code: NPN ISIN: ZAE000015889
Independent auditor
PricewaterhouseCoopers Inc.
Transfer secretaries
JSE Investor Services Proprietary Limited
(Registration number: 2000/007239/07)
One Exchange Square
2 Gwen Lane
Sandown, Sandton 2196
PO Box 4844
Johannesburg 2000, South Africa
Tel: +27 (0)86 140 0110/+27 (0)11 713 0800
ADR programme
Bank of New York Mellon maintains a
GlobalBuyDIRECTSM plan for Naspers Limited
For additional information, please 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:
Bank of New York Mellon, Shareholder Relations
Department – GlobalBuyDIRECTSM
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/+27 (0)11 286 9986
Attorneys
Webber Wentzel (in alliance with Linklaters)
PO Box 61771
Marshalltown 2107
South Africa
Werksmans Inc.
PO Box 1474
Cape Town 8000
South Africa
Investor relations
Eoin Ryan
InvestorRelations@naspers.com
Tel: +1 347-210-4305
Shareholders
1 – 100 shares
101 – 1 000 shares
1 001 – 5 000 shares
5 001 – 10 000 shares
Number of
share-
holders
59 956
16 081
Number of
shares
1 617 708
4 829 919
2 568
5 646 139
546
3 866 021
More than 10 000 shares
1 115
419 551 271
Total
80 266
435 511 058
Public shareholder spread
(N ordinary shares)
To the best knowledge of the directors, the spread of public
shareholders under section 4.25 of the JSE Listings
Requirements at 31 March 2023 was 44.18%, represented by
80 254 shareholders holding 192 430 498 N ordinary shares
in the company. The non-public shareholders of the company
comprising 12 shareholders representing 243 080 560 N
ordinary shares are analysed as follows:
Name
Prosus N.V.
Public Investment
Corporation
% of N
ordinary
shares
Number of
N ordinary
shares owned
49.95%
217 552 704
Category
Naspers share-based
incentive schemes
Directors
1 576 746
2 942 761
7.60%
33 100 894
Group companies
238 574 881
Number of
N ordinary
shares
% of N ordinary
issued share
capital
Naspers share price and volume of trades
4 000
3 500
3 000
2 500
2 000
1 500
1 000
500
0
2
2
0
2
/
4
0
/
1
0
2
2
0
2
/
5
0
/
1
0
●
40 000 000
35 000 000
30 000 000
25 000 000
20 000 000
15 000 000
10 000 000
5 000 000
0
2
2
0
2
/
6
0
/
1
0
2
2
0
2
/
7
0
/
1
0
2
2
0
2
/
8
0
/
1
0
2
2
0
2
/
9
0
/
1
0
2
2
0
2
/
0
1
/
1
0
2
2
0
2
/
1
1
/
1
0
2
2
0
2
/
2
1
/
1
0
3
2
0
2
/
1
0
/
1
0
3
2
0
2
/
2
0
/
1
0
3
2
0
2
/
3
0
/
1
0
3
2
0
2
/
4
0
/
1
0
Volume of trades
●
Share price in rand
Shareholders’ diary
Annual general meeting
Reports
Interim for half-year to September
Announcement of annual reports
Annual financial statements
Dividend
Declaration
Payment
Financial year-end
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0.36%
0.68%
54.78%
August
November
June
June
August
December
March
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Integrated annual report 2023
217
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Glossary
Term/Acronym
Description
Term/Acronym
Description
ADR
Advanced
persistent
threats
Advisory and
assurance
projects
AFM
AGM
Agtech
AI
AI engineers
AI model
production
Alternative
performance
measures
(APMs)
Associate
Average
monthly paying
listers
B2C
bn
BNPL
BRICS
BRL
C2C
CAGR
Capex
CEE
CEO
CFO
CODM
Core headline
earnings
American Depository Receipt
An exercise where a prolonged and targeted cyber-attack is carried out to gain access to a network and
remain undetected for an extended period of time to identify and remediate existing weaknesses.
Projects taken by the cyber-resilience team to advise and provide internal assurance to portfolio
companies to enhance cyber-resilience in the group.
Netherlands Authority for the Financial Markets (Stichting Autoriteit Financiële Markten)
Annual general meeting
Agriculture technology
Artificial intelligence
An employee that focuses on developing the tools, systems, and processes that enable artificial
intelligence to be applied in the real world.
A process of implementing an AI model into software in the group. This is measured by the number of
models placed into production in the group.
In presenting and discussing our performance, we use certain alternative performance measures not
defined by IFRS, referred to as non-IFRS-EU financial measures, alternative performance measures or
APMs. Such measures include economic-interest-basis information; trading profit; adjusted EBITDA; headline
earnings; core headline earnings; and growth in local currency, excluding acquisitions and disposals.
Segmental reviews in this report are prepared showing revenue on an economic-interest basis (which
includes consolidated subsidiaries and a proportionate share of associated companies and joint ventures),
unless otherwise stated.
An entity over which we have significant influence, being the power to participate in the financial and
operating policy decisions of the entity. Generally, an entity in which we have an interest of 20% to 50%.
A measure of the number of monthly users on a platform who yield one or more revenue-generating
transactions, such as listing fees or advertising.
Business-to-consumer (direct-to-consumer)
Billion
Buy-now/pay-later
Brazil, Russia, India, China and South Africa
Brazilian real
Consumer-to-consumer
Compound annual growth rate
Capital expenditure
Central and Eastern Europe
Chief executive officer
Chief financial officer
Chief operating decision-maker
Core headline earnings represent headline earnings, excluding certain non-operating items. Specifically,
headline earnings are adjusted for the following items to derive core headline earnings: (i) equity-settled
share-based payment expenses on transactions where there is no cash cost to the group. These include
those relating to share-based incentive awards settled by issuing treasury shares as well as certain
share-based payment expenses that are deemed to arise on shareholder transactions; (ii) subsequent fair
value remeasurement of cash-settled share-based incentive expenses; (iii) cash-settled share-based
compensation expenses deemed to arise from shareholder transactions by virtue of employment; (iv)
deferred taxation income recognised on the first-time recognition of deferred tax assets as this generally
relates to multiple prior periods and distorts current-period performance; (v) fair value adjustments on
financial instruments and unrealised currency translation differences, as these items obscure the group’s
underlying operating performance; (vi) once-off gains and losses (including acquisition-related costs)
resulting from acquisitions and disposals of businesses as these items relate to changes in the group’s
composition and are not reflective of the group’s underlying operating performance; (vii) the amortisation
of intangible assets recognised in business combinations and acquisitions; and (viii) the donations due to
Covid-19, as these expenses are not considered operational in nature. These adjustments are made to the
earnings of businesses controlled by the group as well as the group’s share of earnings of associates and
joint ventures, to the extent that the information is available.
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Integrated annual report 2023
Corporate
Covid-19
CSRD
Data privacy
roles
Data scientist
Corporate entities which have offices include the Netherlands, Unites States (Ventures), India, United
Kingdom and Hong Kong offices, and corporate employees shall mean people employed at these offices
who are employed by the corporate entities.
Coronavirus disease
Corporate Sustainability Reporting Directive (Europe)
Employees in the group who champion data privacy throughout the group.
Employees who are responsible for collecting, analysing and interpreting data to help drive decision-
making in an organisation.
DAU
Daily active users
Deep-tech
Technology that is based on tangible engineering innovation or scientific advances and discoveries.
Dmart
D-RECs
EBIT
EBITDA
Adjusted
EBITDA
Ecommerce
Economic
interest
Edtech
EMEA
Employee
Employee
engagement
survey
Energy
consumption
Small Delivery Hero-owned warehouse
Renewable-energy credits (electronic records that verify the source of electricity used).
Earnings before interest and tax
Earnings before interest, taxes, depreciation and amortisation
Adjusted EBITDA represents operating profit/loss, as adjusted to exclude: (i) depreciation; (ii) amortisation;
(iii) retention option expenses linked to business combinations; (iv) other losses/gains – net, which includes
dividends received from investments, profits and losses on sale of assets, fair value adjustments of
financial instruments, impairment losses, compensation received from third parties for property, plant and
equipment impaired, lost or stolen, and gains or losses on settlement of liabilities; (v) cash-settled
share-based compensation expenses deemed to arise from shareholder transactions by virtue of
employment; and (vi) subsequent fair value remeasurement of cash-settled share-based compensation
expenses, equity-settled share-based compensation expenses for group share option schemes as well as
those deemed to arise on shareholder transactions (but not excluding share-based payment expenses for
which the group has a cash cost on settlement with participants).
Electronic commerce
Investments in associated companies and joint ventures have been accounted for under the equity method
for all periods, unless otherwise indicated. Associated companies are those companies over which we
exercise significant influence, but which we do not control or jointly control. Joint ventures are
arrangements in which we contractually share control over an activity with others and in which the parties
have rights to the net assets of the arrangement. This approach is consistent with the application of the
equity method of accounting required by IFRS-EU in the financial statements. References to ‘revenue from
the group’ or ‘trading profit from the group’, as applicable, therefore exclude our share of revenue or
trading profit from investments in associated companies and joint ventures. We have, however, also
included certain information based on the proportionate consolidation of associated companies and joint
ventures in that section, as indicated therein and as further explained below.
IFRS 8 Operating Segments aligns the reporting of operating segments with internal management
reporting. As the CODM analyses segment results in accordance with the investments in associated
companies and joint ventures on a proportionately consolidated basis for segmental reporting purposes,
this method is also applied for segment reporting in the financial statements. Proportionate consolidation
is a method of accounting whereby our share of each of the income and expenses of associated
companies and joint ventures is combined line by line with similar items in our operating segments. We
refer to revenue and trading profit measures that include its share of revenue or trading profit from
investments in associated companies and joint ventures as ‘proportionately consolidated’ or on an
‘economic-interest’ basis.
Marrying learning with technology, enabling new and exciting ways for more people to add to their skills
and knowledge.
Europe, Middle East and Africa
Persons employed by the group on a permanent or part-time basis, specifically excluding contract workers,
as at 31 March 2023 determined in accordance with IFRS.
The engagement survey responded to by corporate employees .
The total amount of energy consumed for a given process and measured in kWh.
ESG
Environmental, social and governance
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Integrated annual report 2023
219
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Glossary continued
Term/Acronym
Description
Term/Acronym
Description
Ethics and
compliance
officers
EU
Employees in the group with responsibility for ethics and compliance, in a dedicated ethics and
compliance role or alongside other responsibilities.
Headline
earnings
European Union
EU AI-HLEG
EU’s independent high-level expert group on artificial intelligence.
Fintech
FLIGHT
FMCG
Free cash flow
FY
GAAP
GDP
GDPR
Generative AI
(GenAI)
GHG
GMV
GPO
GRI
Gross
merchandise
value (GMV)
Financial technology is an economic industry that introduces new solutions demonstrating an incremental
or radical/disruptive innovation development of applications, processes, products or business models in
the financial services industry.
Funding and Learning Initiative for Girls in Higher Education and Skills Training (Prosus initiative)
Fast-moving consumer goods
Free cash flow represents cash generated from operations, plus dividends received, minus: (i) net capital
expenditure; (ii) capital leases repaid (gross); and (iii) cash taxation paid. Free cash flow reflects an
additional way of viewing our liquidity that the board believes is useful to investors because it represents
cash flows that could be used for distribution of dividends, repayment of debt (including interest thereon)
or to fund our strategic initiatives, including acquisitions, if any.
Financial year
Generally accepted accounting policies
Gross domestic product
General Data Protection Regulation (Europe)
Systems that can generate new content – or manipulate existing content – based on text instructions.
Greenhouse gas
Gross merchandise value
Global Payments Operations
Formerly Global Reporting Initiative
A measure of the growth of a business determined by the total value of merchandise sold over a given
time period through a consumer-to-consumer (C2C) or business-to-consumer (B2C) platform.
Group
Naspers, Prosus and their subsidiaries.
Growth in
local currency,
excluding
acquisitions and
disposals
We apply certain adjustments to the segmental revenue and trading profit reported in the financial
statements to present the growth in such metrics in local currency and excluding the effects of changes
in our composition. Such underlying adjustments provide a view of our underlying financial performance
that management believes is more comparable between periods by removing the impact of changes
in foreign exchange rates and changes in our composition on our results. Such adjustments are referred
to herein as ‘growth in local currency, excluding acquisitions and disposals’. We apply the following
methodology in calculating growth in local currency, excluding acquisitions and disposals:
» 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-EU results.
» Adjustments made for changes in our composition relate to acquisitions, mergers and disposals of
subsidiaries and equity-accounted investments, as well as to changes in our shareholding in our
equity-accounted investments. For acquisitions, adjustments are made to remove the revenue and
trading profit/(loss) of the acquired entity from the current reporting period and, in subsequent reporting
periods, to ensure that the current reporting period and the comparative reporting period contain
revenue and trading profit/(loss) information relating to the same number of months. For mergers,
adjustments are made to include a portion of the prior period’s revenue and trading profit/(loss) of the
entity acquired as a result of a merger. For disposals, adjustments are made to remove the revenue
and trading profit/(loss) of the disposed entity from the previous reporting period to the extent that
there is no comparable revenue or trading profit/(loss) information in the current period and, in
subsequent reporting periods, to ensure that the previous reporting period does not contain revenue
and trading profit/(loss) information relating to the disposed business.
Headcount
Healthtech
HEPS
HR
IAPP
IAS
IASB
IFRS
IIRC
IMF
Internal rate of
return (IRR)
Headline earnings represent net profit for the year attributable to the group’s equity holders, excluding certain
defined separately identifiable remeasurements relating to, among others, impairments of tangible assets,
intangible assets (including goodwill) and equity-accounted investments, gains and losses on acquisitions
and disposals of investments as well as assets, dilution gains and losses on equity-accounted investments,
remeasurement gains and losses on disposal groups classified as held for sale and remeasurements included
in equity-accounted earnings, net of related taxes (both current and deferred) and the related non-controlling
interests. These remeasurements are determined in accordance with Circular 1/2021, headline earnings, as
issued by the South African Institute of Chartered Accountants, at the request of the JSE Limited in relation to
the calculation of headline earnings and disclosure of a detailed reconciliation of headline earnings to the
earnings numbers used in the calculation of basic earnings per share in accordance with the requirements of
IAS 33 Earnings per Share, under the JSE Listings Requirements.
The number of employees, specifically excluding contract workers, in service as at 31 March 2023.
Health technology involves the design, development, creation, use and maintenance of information
systems and the internet for the healthcare industry. Automated and interoperable healthcare information
systems are expected to lower costs, improve efficiency and reduce error while providing better consumer
care and service.
Headline earnings per share
Human resources
International Association of Privacy Professionals
International Accounting Standards
International Accounting Standards Board
International Financial Reporting Standards
International Integrated Reporting Council
International Monetary Fund
IRR is presented in this report for illustrative purposes only and is calculated based on the estimated
valuations of our internet investments. The estimated valuations are calculated as of 31 March 2022 using
a combination of: (i) prevailing share prices for stakes in listed assets; (ii) valuation estimates derived from
the average of sell-side analysts currently covering Naspers for stakes in unlisted assets; and (iii) post-
money valuations on transactions of these assets or from similar recent transactions for stakes in unlisted
assets where analyst consensus is not available. In respect of (ii) above, we do not endorse, and did not
participate in, or provide any information for purposes of the preparation of the market valuations
calculated by third-party analysts. These valuation estimates have not been confirmed by an independent
third-party expert, such as an accounting firm or an investment bank. Accordingly, these valuation
estimates may not reflect past, present or future fair values, or any potentially achievable fair value in the
future and no reliance can be placed on these valuation estimates.
Investment or
investee
An entity over which we don’t have significant influence, being the power to participate in the financial
and operating policy decisions of the entity. Generally an entity in which we have an interest of less than
20%.
IP
IPO
IR
IRR
ISE
ISP
JSE
JV
K–12
KPI
kWh
Intellectual property
Initial public offering
Investor relations
Internal rate of return
Irish Stock Exchange
Internet service provider
JSE Limited (Johannesburg stock exchange)
Joint venture
Kindergarten to grade 12
Key performance indicator
Kilowatt per hour
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221
Glossary continued
Term/Acronym
Description
Term/Acronym
Description
LatAm
LGPD
LIFE
LTI
m
M&A
MAU
Latin America
General Personal Data Protection Law (Brazil)
Leadership in the food-delivery ecosystem
Long-term incentive
Million
Mergers and acquisitions
Monthly active users
RCF
Red team
exercises
RMB
ROI
RSU
RUB
Revolving credit facility
An exercise, reflecting real-world conditions, to compromise organisational missions and/or business
processes to provide an assessment of the security capability of the system used by the portfolio
company.
Chinese renminbi
Return on investment
Restricted stock unit
Russian rouble
MCSI index
Morgan Stanley Capital International index
R (or ZAR)
South African rand
MENA
MIH B.V.
ML
Monthly active
learners
Middle East and North Africa region
Myriad International Holdings B.V.
Machine learning
Total number of employees who participated in a learning module on MyAcademy.
MyAcademy
MyAcademy is the learning platform offered to employees.
N
NASDAQ
Naspers
Naspers AI
community
NGO
NPS
OECD
Naira – Nigerian currency
American stock market
Naspers Limited
The community of persons interested in and exploring AI in the portfolio companies.
Non-governmental organisation
Net promoter score
Organisation for Economic Co-operation and Development (Brazil)
Omnichannel
A cross-channel content strategy that organisations use to improve their user experience.
Opex
OTT
1p
3p
P2P
Pentests
PLN
PlusOne
POPIA
Portfolio
companies
Prosus
Operating expenditure
Over-the-top
First party – in the context of food delivery, a capital-intensive own-delivery model.
Third party – in the context of food delivery, a capital-light marketplace model where meals are delivered
by restaurants.
Peer-to-peer
A simulated cyber-attack against systems used in the portfolio companies to check for exploitable
vulnerabilities.
Polish zloty
A digital assistant chatbot that runs in the groupwide Slack channels.
Protection of Personal Information Act (South Africa)
Subsidiaries, excluding corporate.
Prosus N.V.
Prosus FLIGHT
Funding and Learning Initiative for Girls in Higher Education and Skills Training
PSP
PwC
Payment service provider
PricewaterhouseCoopers Inc.
SA
SaaS
SAR(s)
SASB
SAST
SBTi
Scope 1
emissions
Scope 2
emissions
Scope 3
emissions
SDG
SICA
SME
SMME(s)
SO(s)
South Africa
Software as a Service
Share appreciation right(s)
Sustainability Accounting Standards Board
South African standard time
Science-based Targets initiative
Scope 1 emissions are direct GHG emissions that arise from sources which organisations own or control.
In order to determine control, the group will recognise emissions from owned and controlled assets as
direct emissions.
Scope 2 emissions are indirect GHG emissions that organisations report from the generation of purchased
electricity that is consumed for operations owned or controlled. The group will account for electricity
purchased for both owned and rented buildings under scope 2.
Category 1
This category includes all upstream emissions from production of products purchased or acquired by the
reporting company in the reporting year. Products include both goods (tangible products) and services
(intangible products).
Category 6
This category includes GHG emissions from the transportation of employees for business-related activities
through air travel. Business travel includes only corporate office data and excludes all subsidiaries.
United Nation’s Sustainable Development Goal
Prosus Social Impact Challenge for Accessibility
Small and medium-sized enterprise
Small, medium and macroenterprise(s)
Share option(s)
Speak up policy
Policy that encourages and provides channels for individuals to report actual, or potential, breaches of the
code of ethics, and other group policies or laws and regulations.
STI
Subsidiary
Short-term incentive
An entity that we control evidenced by:
1. owning more than one half of the voting rights;
2. the right to govern the financial and operating policies of the entity under a statute or an agreement;
3. the right to appoint or remove the majority of the members of the board of directors; or
4. the right to cast the majority of votes at a meeting of the board of directors.
Supply chain
The network of all the individuals, organisations, resources, activities and technology involved in the
creation and sale of products and services.
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Glossary continued
Term/Acronym
Description
TAM
Total addressable market
TCFD
tCO2e
Total payments
in value
TPV
Trading
profit/ loss
Task Force on Climate-related Financial Disclosures
Tonnes of CO2 equivalent
A measure of payments, net of payment reversals, successfully completed through a payments platform
(PayU), excluding transactions processed through gateway products (ie those that link a merchant’s
website to its processing network and enable merchants to accept credit or debit card online payments).
Total payment value
Trading profit/loss represents operating profit/loss, as adjusted to exclude: (i) amortisation of intangible
assets recognised in business combinations and acquisitions, as these expenses are not considered
operational in nature; (ii) retention option expenses linked to business combinations; (iii) other losses/gains
— net, which includes dividends received from investments, profits and losses on sale of assets, fair value
adjustments of financial instruments, impairment losses, compensation received from third parties for
property, plant and equipment impaired, lost or stolen, and gains or losses on settlement of liabilities;
(iv) cash-settled share-based compensation expenses deemed to arise from shareholder transactions by
virtue of employment; and (v) subsequent fair value remeasurement of cash-settled share-based
compensation expenses, equity-settled share-based compensation expenses for group share option
schemes as well as those deemed to arise on shareholder transactions (but not excluding share-based
payment expenses for which the group has a cash cost on settlement with participants).
TSR
UAE
UK
UN
UNEP
Unicorns
US
US$
US$c
VAS
VC
WHO
YoY
Total shareholder return
United Arab Emirates
United Kingdom
United Nations
United Nations Environment Programme
Start-up companies rapidly reaching a valuation of US$1bn.
United States of America
US dollar
US dollar cent
Value-added services
Venture capital
World Health Organization
Year on year
ZAR (or R)
South African rand
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