(Bloomberg) — Prosus NV and its parent Naspers Ltd. swung their e-commerce business into profit for the first time ever as new Chief Executive Officer Fabricio Bloisi prepares to take the reins in July.
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The e-commerce business, which excludes the Tencent Holdings Ltd. stake and comprises a portfolio of companies ranging from iFood in Brazil to PayU in India, reported a full-year trading profit of $38 million for the year ended March 31 as it managed to scale its business after years of investment, according to a statement on Monday.
Improved efficiencies in core units such as classified advertising, food delivery, payments and fintech — as well as cost cuts that included closing non-performing units — drove Prosus’s push to turn its e-commerce business profitable.
The online investment firm and its Cape Town-based parent Naspers made a block-buster early-stage investment in Tencent in 2001 for $34 million. Since then, the Chinese company’s growth has exploded. That led the group to sell down some of its stake in Tencent and buy back its own shares to close a gap between the sum of its parts, and the value of its stake. The repurchase program has created $30 billion in value to date, the company said in the statement.
While net income for the year declined 35% to $6.61 billion, it exceeded the $6.25 billion estimate in a Bloomberg survey.
Former iFood head Bloisi will become CEO July 1, taking over from interim head Ervin Tu, who becomes chief investment officer and president. Bob van Dijk, who headed the company for a decade, resigned in September.
(Updates with net income in fifth paragraph.)
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