(Bloomberg) — Prosus and its parent company Naspers AG reported their first profitable e-commerce business as new Chief Executive Officer Fabricio Broisi prepares to take over in July.
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The e-commerce business, which excludes Tencent Holdings Ltd.'s stake, has a portfolio of companies ranging from Brazil's iFood to India's PayU and has successfully expanded its business after years of investment, reporting an operating profit of $38 million for the full year ended March 31, it said in a statement on Monday.
Efficiency gains in core divisions such as classified advertising, food delivery, payments and fintech, as well as cost cuts including the closure of unprofitable units, have supported Prosus' efforts to monetise its e-commerce business.
The online investment firm and its Cape Town-based parent company Naspers made a big early-stage investment of $34 million in Tencent in 2001. Since then, the Chinese company has grown explosively. As a result, the group decided to sell some of its Tencent stake and buy back shares to close the gap between the value of each company's combined holdings and its own. The company said in a statement that the buyback program has created $30 billion in value so far.
Full-year net income fell 35 percent to $6.61 billion, but beat the $6.25 billion forecast in a Bloomberg survey.
Broisi, the former president of iFood, will take over as CEO on July 1, succeeding interim president Irving Tu, who will also serve as chief investment officer and president. Bob van Dijk stepped down in September after 10 years at the helm.
(Updates with net income in 5th paragraph.)
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