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Tencent boosts Prosus profit, e-commerce trading loss widens

China foreign exchange regulator fines Tencent's Tenpay for misconduct
China foreign exchange regulator fines Tencent's Tenpay for misconduct   -   Copyright  Thomson Reuters 2021   -  
By Reuters

<div> <p>By Toby Sterling and Promit Mukherjee</p> <p><span class="caps">AMSTERDAM</span>/JOHANNESBURG – 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.</p> <p>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 dominating its overall performance. </p> <p>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.</p> <p>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. </p> <p>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.</p> <p>Prosus estimated the market value of the e-commerce businesses at around $49 billion. </p> <p>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.</p> <p>The figures were in line with indications the company had given in a Nov. 16 pre-announcement.</p> <p>Bob Van Dijk, the Prosus <span class="caps">CEO</span>, said he did not expect China’s recent moves to crack down on large technology firms to impact future earnings negatively.</p> <p>“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.</p> <p>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.</p> <p>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. </p> <p/> </div>