Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Tencent boosts Prosus profit, e-commerce trading loss widens

Published 22/11/2021, 07:18
Updated 22/11/2021, 10:01
© Reuters. FILE PHOTO: A logo of Prosus is diplayed at Amsterdam's stock exchange building as Prosus begins trading on the Euronext stock exchange in Amsterdam, Netherlands, September 11, 2019. REUTERS/Piroschka van de Wouw/File Photo

© Reuters. FILE PHOTO: A logo of Prosus is diplayed at Amsterdam's stock exchange building as Prosus begins trading on the Euronext stock exchange in Amsterdam, Netherlands, September 11, 2019. REUTERS/Piroschka van de Wouw/File Photo

By Toby Sterling and Promit Mukherjee

AMSTERDAM/JOHANNESBURG (Reuters) - Prosus, which owns a $175 billion minority stake in Chinese internet gaming and social media group Tencent, posted an 8% rise in first-half trading profit to $2.9 billion as revenue rose rapidly in its overall portfolio.

Sometimes compared to SoftBank and its Vision Fund, Prosus NV, owns stakes in a wide range of consumer internet companies, with returns from Tencent Holdings (HK:0700) dominating its overall performance.

Although its net profit spiked after Prosus booked a one-time profit of $12.3 billion on the sale of part of its Tencent stake, operating losses at businesses it controls increased.

Prosus said in a statement on Monday that revenues at its e-commerce portfolio had risen by 53% to $4.2 billion, while that segment's trading loss increased to $372 million from a loss of $214 million in the same period a year ago.

The e-commerce portfolio, which does not include returns from its holding in Tencent, spans a group of businesses that Prosus either owns or controls in classified advertising, food delivery, educational technology and fintech and payments.

Prosus estimated the market value of the e-commerce businesses at around $49 billion.

It showed better profitability in its classifieds businesses, and strong growth at its food delivery businesses, which includes iFood in Brazil and Swiggy in India.

The figures were in line with indications the company had given in a Nov. 16 pre-announcement.

Bob Van Dijk, the Prosus CEO, said he did not expect China's recent moves to crack down on large technology firms to impact future earnings negatively.

"In spite of some regulation coming up ... Tencent is in my view the best-positioned internet company in the most attractive internet market in the world," he told reporters on a call.

© Reuters. FILE PHOTO: A Tencent logo is seen at its booth at the 2020 China International Fair for Trade in Services (CIFTIS) in Beijing, China September 4, 2020. REUTERS/Tingshu Wang/File Photo

In August, Prosus set up a cross-holding structure with Naspers, under which Prosus shareholders own 60% of their underlying assets but Naspers retains control. They share a single board.

In its separate earnings report, Naspers, South Africa's largest company by market capitalization, posted half-year revenue of $17.2 billion, up 29% from a year ago.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.