In pursuit Integrated annual report 2018 of growth … To view the online report, please visit our website: www.naspersreports.com

San Francisco, USA Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 01

Naspers is a unique and exciting technology operator and investor. We back entrepreneurs to build digital technology platforms that improve the lives of hundreds of millions of people around the world.

GROUP REVENUES GREW CLASSIFIEDS (excluding letgo) (1) became profitable during the 39 % year, contributing to group trading profit to US$20.1bn(2)

TRADING PROFIT GREW STRENGTHENED OUR POSITION (1) in online food-delivery services … today … by investing a combined US$1.4bn 52 % in Delivery Hero and Swiggy to US$3.4bn(2)

CORE HEADLINE EARNINGS VIDEO ENTERTAINMENT WAS UP (South Africa)

contributed steady revenue 72 % and trading profit growth at US$2.5bn

(2) SOLD A 79 % of our revenue now comes 2 % from our internet and (1) interest in Tencent, to reinforce ecommerce activities the balance sheet and pursue Notes growth opportunities, generating (1) Growth in local currency, excluding M&A. proceeds of US$9.8bn (2) Presented on an economic-interest basis. 02 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

We have been growing our business for a long time. We know that decisions we make today impact our success tomorrow. Our ability to act early on anticipated global changes ultimately determines our future. Looking ahead, we are focused on:

Scaling our ecommerce businesses (especially classifieds, travel, payments and online … tomorrow … 1 food delivery). Transforming our video- entertainment and media 2 businesses for a digital world.

Deploying machine learning (ML) and artificial intelligence 3 (AI) across all our businesses.

Hunting for the next wave of growth through Naspers 4 Ventures. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 03

From Brazil to India, Russia to South Africa – we manage our assets and allocate capital to maximise growth.

We operate in more than 12 0 … around markets and countries the world 24 887 employees > 1.3 bn online users across our markets 04 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

We are a global internet and entertainment Contents group and one of the largest and most successful About this report...... 05 Group overview...... 07 Chair’s review...... 09 technology investors in the world. Operating Chief executive’s review...... 11 in more than 120 countries and markets with The Naspers approach...... 13 Business overview...... 17 long-term growth potential, we build leading Our business model...... 17 Reporting on the six capitals...... 18 The world around us...... 19 companies that empower people and enrich Engaging our stakeholders...... 20 Active portfolio management ...... 26 communities. We run and invest in some of Capital performance snapshot...... 27 Value creation...... 28 the world’s leading digital platforms in internet, Tax...... 29 Performance review...... 31 Internet...... 33 video entertainment and media. Video Entertainment...... 41 Media...... 45 Our people...... 49 Financial review...... 51 Naspers companies connect people to each Similarly, hundreds of millions of Managing risks and opportunities...... 52 other and the wider world, help people people have made the platforms of Governance...... 58 improve their daily lives, and entertain our associates a part of their daily lives: Our board...... 59 audiences with the best of local and global Tencent (www.tencent.com; SEHK 00700), Governance for a sustainable business...... 62 Mail.ru (www.corp.mail.ru; LSE: MAIL), content. Every day, millions of people use Remuneration report...... 68 the products and services of companies we MakeMyTrip Limited (www.makemytrip. have invested in, acquired or built, including com; NASDAQ:MMYT) and Delivery Hero Summarised consolidated Avito, Brainly, Codecademy, eMAG, iFood, (www.deliveryhero.com; Xetra: DHER). annual financial statements...... 92 letgo, Media24, Movile, MultiChoice, OLX, Further information...... 110 Naspers is listed on the JSE Limited, PayU, Showmax, SimilarWeb, Swiggy, Notice of annual general meeting...... 111 Johannesburg’s stock exchange (NPN.SJ), Twiggle and Udemy. Form of proxy...... 114 and has an ADR listing on the London Stock Notes to the form of proxy...... 115 Exchange (LSE: NPSN). Shareholder and corporate information...... 116 Analysis of shareholders and shareholders’ diary...... 117 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 05 About this report The Naspers integrated annual report assesses our performance for the year to 31 March 2018, focusing on the value we created for our key stakeholders. The aim is to provide a picture of our progress and impact.

How it all fits together

We manage our business We measure our … as identified in … social and relationship, We understand the … deliver financial with purpose, with an performance by the Framework of and natural capitals, as risks we take and performance (outcomes) innovative approach evaluating how we the International well as progress against manage these to and value (outputs) for to how we operate, create value for our Integrated Reporting our strategy, and regularly minimise their impact our stakeholders. This allocate capital, and key stakeholders, Council: financial, measuring returns on on our business and is embedded in our address key markets taking account of human, intellectual, invested capital. results. Value creation business model (page 17) and societal trends. the six capitals … manufacturing … is the consequence of and integral to the how we … way we think and make decisions. We pursue growth by building companies that empower people and enrich communities. Financial Human Manufactured

Intellectual Social and Natural relationship

The Naspers Our business Stakeholder Value Risks and See page 13 See page 17 See page 20 See page 28 See page 52 Governance See page 58 approach model engagement creation opportunities 06 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

About this report continued

Listing information Such adjustments (pro forma financial Forward-looking statements Assurance Naspers has its primary listing on the information) are quoted in brackets This report contains forward-looking Financial information extracted from the Statement of the board of directors JSE Limited (the JSE) (NPN.SJ) in South after the equivalent metrics reported statements as defined in the United audited Naspers Limited consolidated Africa, where it forms part of the Top under IFRS. Refer to page 107 of States Private Securities Litigation annual financial statements for the on the integrated annual report 10 index and where most of its shares the summarised consolidated annual Reform Act of 1995. Words such as year ended 31 March 2018 and trade. It also has a level 1 American financial statements for a reconciliation “believe”, “anticipate”, “intend”, “seek”, presented in this report was audited by This report is primarily intended to address Depository Receipt (ADR) programme of these metrics with the equivalent “will”, “plan”, “could”, “may”, “endeavour” PricewaterhouseCoopers Inc. (PwC) the information requirements of long-term listing on the London Stock Exchange amounts reported under IFRS. Financial and similar expressions are intended to (refer to page 93 for the PwC report). (LSE) (NPSN) and trades on an commentary and segmental reviews identify such forward-looking PwC also performed specific procedures investors (our equity shareholders, over-the-counter (OTC) basis in the are prepared on an economic-interest statements, but are not the exclusive on the material non-financial information bondholders and prospective investors). United States. International investors basis (which includes consolidated means of identifying such statements. By contained in this report. South African We also present information relevant are therefore able to buy and sell subsidiaries and a proportionate share their nature, forward-looking statements broad-based black economic Naspers securities through the OTC of associated companies and joint involve risk and uncertainty because they empowerment (BBBEE) information to the way we create value for other key market, on the LSE or JSE (details on ventures), unless otherwise stated. relate to future events and circumstances wasassured by EmpowerLogic stakeholders, including our employees, page 4). Naspers’s direct wholly owned and should be considered in light of (Naspers,MultiChoice and Media24). customers, clients, regulators and society. subsidiary, Myriad International Holdings The legislation and frameworks various important factors. While these B.V. (MIH BV), also has three bonds that inform our reporting forward-looking statements represent The group has a combined assurance listed on the Irish Stock Exchange (ISE). The integrated annual report was our judgements and future expectations, model for internal use. Our combined After being reviewed by the audit committee prepared against local and global a number of risks, uncertainties and assurance model is designed and and board, the board approved the Scope and boundary of reporting standards, including: other important factors could cause implemented to cover the key risks Financial and non-financial reporting actual developments and results to differ through a combination of assurance integrated annual report. The summarised The report extends beyond financial • Framework of the International materially from our expectations. The service providers and functions as is consolidated annual financial statements reporting. It reflects on non-financial Integrated Reporting Council (IIRC): key factors that could cause our actual appropriate for Naspers. were prepared in accordance with IFRS and performance, opportunities, risks and this principles-based approach results performance or achievements to outcomes attributable to or associated promotes the concept of the six differ materially from those in the An overview of combined assurance the Companies Act, while the integrated with key stakeholders, which have capitals, which considers material forward-looking statements include, per key risk is reported for consideration annual report was prepared using the a significant influence on our ability inputs and resources required to among others: changes to IFRS and the by the joint audit and risk committees. IIRC framework and the recommendations to create value. create and sustain value in the long interpretations, applications and practices term. We describe key components subject thereto as they apply to past, Our group internal audit and risk support of King IV™. In our opinion, the integrated It includes the financial performance of the Naspers value chain (business present and future periods; ongoing and function has all controlled assets in scope. annual report and annual financial of Naspers Limited and its subsidiaries, model), which creates and sustains future acquisitions; changes to domestic The head of internal audit and risk statements fairly reflect the financial joint ventures and associates (the value for our stakeholders. and international business and market support reports to the audit committee group). The scope of reporting on • South African Companies Act 71 of conditions such as exchange rate and and presents for its approval an objective- position of the group at 31 March 2018 non-financial performance is indicated 2008, as amended (the Companies interest rate movements; changes in the driven, risk-based internal audit plan. and its operations for this period. in this report. Some South African Act). domestic and international regulatory Where required, external parties subsidiaries publish separate integrated • King IV™ Report on Corporate and legislative environments; changes to support the internal audit function, such On behalf of the board reports (www.multichoice.co.za and Governance for South Africa, 2016 domestic and international operational, as forensic specialists or data analytics www.media24.com). Group reporting (King IV™). social, economic and political conditions; experts. Other external assurance standards are continually being developed • International Financial Reporting the occurrence of labour disruptions and providers are enlisted on an as-needed to make disclosure meaningful and Standards (IFRS). industrial action and the effects of both basis. In our more regulated businesses measurable for stakeholders. Given the current and future litigation. We are not (like PayU), regulatory inspectors visit highly competitive environment in Materiality and material matters under any obligation to (and expressly on a periodic, ongoing basis. Koos Bekker Bob van Dijk which the group operates, and the We apply the principle of materiality disclaim any such obligation to) revise or Chair Chief executive impact of currency volatility on our in assessing what information is to be update any forward-looking statements The audit committee appoints the financial results, this report mostly included in our integrated report. This contained in this report, whether as a external auditor, reviews the auditor’s Cape Town excludes financial targets or forward- report focuses particularly on those result of new information, future events independence annually and oversees 22 June 2018 looking statements other than as issues, opportunities and challenges that or otherwise. We cannot give any the external audit. The audit committee explained on page 6. impact materially on the group, as well assurance that forward-looking makes recommendations to the board as its ability to be a sustainable business statements will prove to be correct and in this regard and assists the board in Where relevant, we have adjusted that consistently delivers value to all key investors are cautioned not to place ensuring the integrity of external amounts and percentages for the stakeholders, including our shareholders. undue reliance on any forward-looking reports. The annual chief executive/ effects of foreign currency, as well statements contained herein. CFO signoff process also covers as acquisitions and disposals. financial reporting. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 07

Group overview

Moscow, Russia 08 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Market leaders We are market leaders in Group overview many of the businesses and markets where we operate. Our most significant markets are Africa, China, Russia, Our principal operations are in internet services, where we have Central and Eastern Europe, North America, Latin investments in social and internet platforms, but we predominantly America, India, Southeast Asia focus on ecommerce (especially classifieds, etail, travel, payments and the Middle East. and online food delivery), video entertainment and media.

Internet Video entertainment Media(1) REVENUE Etail Online food delivery REVENUE REVENUE This comprises our etail subsidiaries, eMAG This portfolio consists of online food US$15.9bn and Takealot and our associate, Flipkart. delivery businesses operating in more than US$3.7bn US$374m Operations are spread across Central and 45 markets globally including iFood, up 51%(1) up 7%(1) flat year on year Eastern Europe, South Africa and India. Delivery Hero and Swiggy. TRADING PROFIT TRADING PROFIT TRADING LOSS

Read more on page 37 US$3.1bn Read more on page 37 US$369m US$30m up 56%(1) Ventures up 24%(1) increasing 33% year on year(2) Travel EMPLOYEES Naspers Ventures partners with EMPLOYEES EMPLOYEES MakeMyTrip, listed on the NASDAQ, is a entrepreneurs to build leading technology leading Indian online travel company. It companies, with the ambition to fuel the provides online travel services including flight next wave of growth for Naspers. 13 739 Naspers Ventures provides operational 7 064 3 747 Note tickets, domestic and international holiday Note Notes (1) Presented on an economic-interest basis with growth packages, hotel reservations and bus tickets. support to help founders solve the (1) Growth in local currency, excluding M&A. (1) All figures exclude Novus. in local currency, excluding M&A. challenges they face, including business (2) Presented on an economic-interest basis with growth strategy expertise, operating experience Through MultiChoice South Africa and in local currency, excluding M&A. We operate internet platforms across a variety MultiChoice Africa, our video-entertainment of platforms and geographies. We focus on and/or access to on-the-ground resources Media24 is Africa’s leading media group Read more on page 39 in key expansion markets. division brings entertainment to over 13m ecommerce, but offer the full range of subscribing households in 50 countries across with interests in digital media and services, newspapers, magazines, ecommerce, book internet-based services from communication Payments sub-Saharan Africa. With limited broadband and social networking to entertainment and infrastructure and almost no cable access publishing, print and distribution. It publishes mobile value-added services. PayU is one of the largest online payment in Africa, we offer digital satellite (DTH), some 30 magazines and 80 newspapers and Our internet operations include: service platforms in the world, with leading reaches more than 16m average daily unique Read more on page 39 digital terrestrial (DTT) and online video- positions in 17 markets across Africa and the entertainment services, including subscription browsers across its digital platforms. Middle East, Central and Eastern Europe, video-on-demand (SVOD) service, Showmax. Classifieds India and Latin America. Included in this Social and internet platforms M-Net provides general entertainment Our footprint spreads across 41 markets. segment are the group’s fintech and credit We also hold investments in listed internet content and SuperSport, the largest funder of Our companies OLX, Avito and letgo have associates, Kreditech and Remitly. sport on the African continent, ensures quality companies: Tencent (31.2%) is China’s Get a career you can be proud of. the number-one-ranked mobile classifieds largest and most-used internet-services sport content for our customers. Technology app in more than 22 countries. platform and Mail.ru Group (28.4%) provider Irdeto is a world leader in content Read more on page 45 is the leading internet company in security, management and delivery. Read more on page 35 Russian-speaking markets.

Read more on page 40 Read more on page 34 Read more on page 41 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 09 Chair’s review

Naspers makes a difference around the world by backing entrepreneurs and new technologies that may transform people’s lives for the better. During the past year we added to established businesses, such as classifieds and video entertainment, and advanced into newer areas such as online food delivery and providing financial services to underserved people.

Making a positive impact We focus on creating Once again, board members provided The board is informed of subsidiary We run many different businesses valuable guidance and support. activities via a disciplined reporting across the group, at various stages of sustainable, all-round value. structure. Strategies and business plans their life cycles. A common thread is the In this spirit of long-term We also recognise the contribution of for financial and non-financial elements impact they have on the lives of people positive impact, we so many partners and suppliers, as well of operations are regularly reviewed. around the world. as collaboration with governmental Part of management’s remuneration measure and report on bodies in numerous countries. depends on performance against We try to focus on creating sustainable, the six capitals: financial, financial and operational targets, and all-round value. We measure the six Ensuring good governance individual and group objectives, linked capitals: financial, human, intellectual, human, intellectual, We are committed to good to strategic objectives. manufacturing, social and relationship, manufacturing, social governance. As a multinational group, “I love the fact that and natural capital. our risks differ by jurisdiction. More We continually evaluate areas where and relationship, and information is provided in our risk governance can be improved. This is Naspers keeps We summarise our performance natural capital. management section on page 52. We detailed in our application of King IV™ against the aims mentioned in this aim to conduct the group’s business in the governance frameworks of reinventing itself. At heart, integrated annual report, but allow Our classifieds business helps to recycle with integrity, applying appropriate Naspers, MultiChoice and Media24 in me to touch on a few examples. used products, cutting down on the global corporate governance policies and the full governance report. we are about technology carbon footprint. principles around the world. Where Our fast-growing payments and fintech Naspers subsidiaries are governed and entrepreneurship.” business, PayU, is helping evolve a Online food delivery services help people by independent boards of directors, CLASSIFIED BUSINESSES (COUNTRIES) borderless world where everyone can to save time. these apply suitable governance transfer money. How? By applying new practices and their committees are technology to create quick and easy Video services help people in remote mandated to comply with relevant credit for underbanked people. It could places stay in contact with the latest requirements. Naspers has a legal be a life changer. happenings anywhere in the world. compliance programme, detailed on pages 65 and 66. Another one that stands out for me is the SuperSport Let’s Play initiative. It reaches The audit and risk committees of 41 over a million learners. the board also monitor the group’s compliance with listings requirements Contributing around the world of the JSE Limited (the JSE), London The key to our growth is the commitment Stock Exchange (LSE) and Irish Stock of many thousands of people inside Exchange (ISE). Naspers. We appreciate your efforts!

We value the effort and considered risk-taking of our executives under Bob van Dijk’s lead. 10 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Board changes 10-YEAR REVIEW (DIVIDEND PER LISTED N ORDINARY SHARE) (shares trade ex dividend from As noted in our last report, Emilie Choi Wednesday 12 September 2018). Making it easy for everyone was appointed as an independent Share certificates may not be to take on board our code non-executive director on 21 April 2017. dematerialised or rematerialised of business ethics and between Wednesday 12 September Mark Sorour, executive director and 2018 and Friday 14 September 2018, conduct group chief investment officer (C1O) of both dates inclusive. Naspers, retired on 1 April 2018 after We know how important it is for The dividend will be declared from two decades. Mark was at the cutting everyone across the group to take on edge of the group’s expansion and led income reserves. It will be subject to board and sign up to our global code some of the biggest transactions for a dividend tax rate of 20%, yielding a of business ethics and conduct. We Naspers. What a great career! He will net dividend of 520 cents per listed want to make this as easy and effective remain on the board as non-executive N ordinary share and 104 cents per as possible. To this end, we have an director and we hope to benefit from unlisted A ordinary share to those engaging interactive code of business his counsel. shareholders not exempted from ethics and conduct course that’s available paying dividend tax. Dividend tax will to everyone on our groupwide learning be 130 cents per listed N ordinary share portal, MyAcademy. It is one of a and 26 cents per unlisted A ordinary number of training materials readily 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 share. The issued ordinary share capital available via MyAcademy. Note as at 22 June 2018 was 438 656 059 450 000 All figures are in SA cents. N ordinary shares and 907 128 The accessible interactive format of the CHILDREN TOOK PART IN THE 2017 A ordinary shares. The company’s code of business ethics and conduct LET’S PLAY SCHOOLS PHYSICAL income tax reference number is training, which uses animation and Q&A EDUCATION CHALLENGE 9550138714. formats, has proven to be a very popular way to learn about and sign up to our As laid out in our memorandum of In compliance with the Companies Act, Looking ahead global code of business ethics and PROPOSED ANNUAL GROSS DIVIDEND incorporation, one third of non-executive shareholders will be asked to consider INCREASED BY 12% As this integrated annual report shows, conduct. directors retire annually. This year Craig these proposals at the annual general there are positives in past performance, Enenstein, Don Eriksson, Hendrik du meeting. Please see directors’ curricula but also risks ahead. Technology moves At Takealot, where they have over Toit, Guijun Liu and Roberto Oliveira vitae on pages 59 and 60. fast and competition is often brutal. 600 employees at two distribution de Lima retire by rotation but, being centres, they’ve taken an inventive 650 SA cents eligible, offer themselves for re-election. Dividend (all figures in South PER LISTED N ORDINARY SHARE On behalf of the board I would like to and cost-effective approach to making At the annual general meeting, African cents) thank everyone helping to grow this MyAcademy and its online resources shareholders will be asked to consider The board recommends that the annual exceptional business. available to everyone. At each distribution the re-election of these directors gross dividend be increased by 12% to centre they have converted containers (see notice on page 111). 650 cents (previously 580 cents) per into computer centres for employees. It’s listed N ordinary share, and 130 cents an easy onsite way for people who may Don Eriksson, Ben van der Ross and (previously 116 cents) per unlisted not have their own internet access to be Rachel Jafta are members of the audit A ordinary share. Koos Bekker able to log on and develop their skills. committee. The board recommends to Chair shareholders that they be reappointed If confirmed by shareholders at the as audit committee members. This is annual general meeting on Friday 22 June 2018 becoming a demanding committee of 24 August 2018, dividends will be any board. payable to shareholders recorded in the books on Friday 14 September 2018 and paid on Monday 17 September 2018. The last date to trade cum dividend will MyAcademy and its online resources be on Tuesday 11 September 2018 available to everyone Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 11

our revenue comes from internet Crystallising potential our businesses is a source of frustration measured on an economic-interest and ecommerce businesses. In the We have now entered the third phase, for investors. We believe that basis, was US$20.1bn, up 38% on last Chief executive’s next few years, this will approach 100% focusing on crystallising the potential crystallising potential together with year (or 39% in local currency and with the continued growth of our of our core assets. So far, the group structural actions that address the adjusted for acquisitions and disposals). online businesses, new investments has relied heavily on the video- drivers of the discount will resolve Ecommerce and Tencent were key review in technology companies, and the entertainment business for cash. this over time. drivers of this growth. On the same completion of the digital transformation In this phase, we should see reduced basis, group trading profit rose 47% to of our video-entertainment and dependency on video entertainment Performing strongly US$3.4bn (or 52% in local currency and “We made good progress this year, media businesses. for cash as the ecommerce business So how has this journey played out in adjusted for acquisitions and disposals). grows to profitability. We will the year to 31 March 2018? We have Ecommerce – particularly the classifieds, characterised by strong financial It’s a transformation that my team has concentrate on scaling core segments, concentrated on giving you a full answer payments and travel businesses – been determined to achieve. including classifieds, online food delivery through this integrated annual report, improved profitability. Tencent’s strong performance, effective capital and payments. And we will continue to but I’d also like to summarise some of performance contributed to the trading Optimising the portfolio plant seeds for longer-term growth by the key highlights. profit acceleration. Core headline allocation and positive impact The initial focus in recent years was selectively investing in new opportunities. earnings, the board’s measure of on optimising the portfolio. There were Growing revenues and profitability operating performance, was up 72% as we continued to deliver on many assets with outstanding potential, We recognise that the discount We delivered robust growth, recording on last year at US$2.5bn. like OLX. To take them to the next between our market capitalisation and consolidated year-on-year revenue our growth strategy.” level, we needed to bring them the sum-of-the-parts valuation of growth of 9%. Group revenue, together in defined segments with world-class leadership. There were Our journey so far Over the past few years we’ve been also several underperforming assets on an exciting journey, pursuing growth we quickly addressed. with focus and intensity. It’s a journey that is taking us deeper into the lives of Accelerating growth hundreds of millions of people around The second wave was focused on 1 2 3 the world. Today, our companies and accelerating the growth in our RESET ACCELERATE CRYSTALLISE associates play an important role in the ecommerce businesses by prioritising • Organised in global segments • Accelerated ecommerce growth • Grow ecommerce to profitability lives of the customers and communities those with the most promise, and • Established an excellent • Consolidated for leadership • Develop core segments into ensuring disciplined operational ecommerce team • Exited peak-value businesses US$5-10+bn businesses we serve, finding ever-better ways to • Divested low-potential assets • Executed quality growth • Plant seeds for longer-term inform and entertain, learn, execution. We also consolidated several investments growth communicate, enable buying and selling, businesses, and our transactions with provide access to payment and financial Schibsted and MakeMyTrip are good services, and even eat. And as this year examples. Consistent with our strategy shows, it is a journey that is delivering to find and realise value for our lasting rewards for all our stakeholders. shareholders, we reallocated significant capital from assets we believed were at Rapidly transforming their peak to fund promising new growth Our transformation to a fully online areas. Allegro is a good example. group continues. Just 10 years ago publishing and media accounted for 2014–2015 2016–2017 Now 89% of our revenue. Today, 79% of

Key events through the year 2017 May Aug Oct

MakeMyTrip, India’s leading We led a US$80m funding round We invested US$473m in Delivery Annual general meeting. Marques. The Order of Building on an earlier We led a US$115m online travel company, through a US$61m investment Hero, the leading global online Following the annual general Tafelberg, awarded to an investment in 2015, investment round in successfully raised US$330m in India-based food-ordering food-ordering and delivery meeting we reached out to outstanding business partner, we invested a further US$74m Remitly, by investing in equity financing. and delivery platform, Swiggy, marketplace. investors who had expressed went to Ferguson Films, which in Takealot, South Africa’s US$100m to accelerate providing funds for growth and an interest in remuneration has produced some of video- leading ecommerce company, global expansion in PayU invested US$99m in reinforcing our commitment to issues and have considered entertainment’s flagship to pursue further scale and financial services. German fintech company, help the business become a and implemented some channel, Mzansi continued growth. Kreditech. PayU and Kreditech leader in food ordering and key suggestions. The Phil Weber Magic’s content. agreed on a global partnership delivery across India. award, the group’s highest to increase access to credit accolade for performance, went services in high-growth markets. US$473m to Serge de Reus and Glen US$74m US$10 0 m 12 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Our journey so far in Nigeria and Angola. The business core businesses to increasing our fundamental needs of people – Chief executive’s added 1 013 371 direct-to-home holdings in key partners, from raising changing their lives for the better. review continued NASPERS’S RELATIVE MARKET PERFORMANCE, MARCH 2008 – MARCH 2018 (DTH) subscribers and 520 979 digital funds for reinvestment to encouraging INDEX 31 MARCH 2008 = 100 terrestrial television (DTT) subscribers and recognising innovation. Looking ahead to bring the total base across Africa to Looking ahead, we will use our strong Internet over 13m households at 31 March 2018. balance sheet to accelerate the growth Naspers market cap vs Nasdaq index (in US$) TOTAL VIDEO-ENTERTAINMENT Internet revenues grew 50% (51%) to of our classifieds, online food-delivery 100% of S&P 1500 from cable and satellite, broadcasting and publishing sub-indexes Media SUBSCRIBERS ACROSS AFRICA US$15.9bn, fuelled by ecommerce and and payments businesses globally and to Media24 (all figures excluding Novus) (HOUSEHOLDS) pursue additional growth opportunities Tencent’s strong results. Trading profit for the internet segment rose 50% produced stable results, with revenue that we aim to identify early. We will (56%) to US$3.1bn. flat year on year at US$374m, against continue to scale our ecommerce and a backdrop of declining revenues from sub-Saharan African video-entertainment Focus on ecommerce traditional media streams. businesses and drive them closer to In the ecommerce business, revenue > profitability. And we will also continue Managing our assets growth accelerated to 36% versus 27% to focus on innovation, particularly in Across all our segments, throughout m the areas of machine learning, and on last year, with meaningful reductions in our different businesses, we are Post13 the year-end, we announced the navigating macroeconomic headwinds trading losses. Notably, the classifieds rigorously managing our assets and sale of our entire interest in Flipkart, and managing costs in mature businesses. business (excluding letgo) became profitable and free cash flow (FCF) capital allocation for growth and India’s largest ecommerce marketplace financial returns. As you can see from for US$2.2bn, representing an internal We made good progress this year positive during the year and contributed to group trading profit. The payments the year’s events outlined below, our rate of return (IRR) of some 32%. India and I look forward to working with business reduced trading losses on its active management ranges from is one of the most exciting markets in our teams around the world in the existing footprint while continuing to reinforcing and expanding our existing the world and we are proud to back year ahead to continue on our path scale. We strengthened our position Indian entrepreneurs whom we believe of growth. in online food delivery services by have what it takes to build outstanding investing a combined US$1.4bn in 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 and long-lasting businesses. Our decision to dispose of our interest in Delivery Hero and Swiggy. Note Share of S&P 500 market cap from S&P composite 1500 for publishing, broadcasting and cable and satellite Flipkart is consistent with our strategy Focus on Tencent sub-industries. Source: FactSet to realise returns from businesses we To reinforce the balance sheet and help to build. We invest in businesses Bob van Dijk where we can influence and contribute pursue growth opportunities in, among INVESTMENT IN DELIVERY HERO industry in the world, managed by an Chief executive others, the classifieds, online food AND SWIGGY exceptionally able team. Naspers will not “From helping a farmer in to growth. delivery and payments businesses, sell further Tencent shares for at least the Kenya buy a life-changing 22 June 2018 we reduced our interest in Tencent, next three years, in line with our Our activities vary but the core of through a sale, from 33.17% to 31.17% long-term belief in Tencent’s business. secondhand bicycle to what we do is find and back local in March 2018, generating net proceeds helping people send money entrepreneurs around the world of US$9.8bn. US$1.4 bn Video entertainment and help them scale their businesses. Our video-entertainment business home to relatives wherever We prioritise businesses with platform Naspers has not previously sold any contributed steady revenue and trading they are in the world, potential in high-growth markets; those Tencent shares since it invested in 2001. profit growth, with trading losses in the Naspers answers local that can become a frequent customer We consider Tencent to be one of the sub-Saharan African business stabilising destination. These tend to address the very best growth enterprises in any despite further currency weakness needs on a global scale.”

2017 2018 Dec Jan Feb Mar

Together with Innova Capital, we Our audit and risk committees The committees and the We led another US$100m The capital provides for further We reduced our stake in Following the acquisition, invested a further US$82m in Movile. and the board considered the board were satisfied that the funding round by investing growth and improving the Tencent, from 33.17% to the group holds a 23% effective The investment will be used to expand work done by MultiChoice process MultiChoice had a further US$60m in Swiggy, consumer experience on 31.17% – raising US$9.8bn, interest (22% fully diluted) in Movile’s presence in food delivery. South Africa following the followed had been rigorous India’s leading online food- Swiggy’s platform through which will be used to reinforce Delivery Hero. concerns that were raised in and that the conclusions ordering and delivery platform. investment in technology, our balance sheet and fuel We held an Investor Day in New York, the media concerning lobbying MultiChoice reached were new service offerings, logistics further growth. giving investors the opportunity to and MultiChoice South Africa’s reasonable and justifiable. and restaurant services. understand progress made in our relationship with ANN7. During March 2018, following the ecommerce businesses, and hear receipt of regulatory approval, the our group chief executive and group acquired Rocket Internet chief financial officer (CFO) discuss SE’s interest in Delivery Hero our strategy, returns on invested US$60m for US$778m. US$9.8 bn capital, and financials.

Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 13

We think global and support local teams. The Naspers 1 See page 14 We rigorously manage our assets and capital allocation approach … for growth. 2 See page 15 From the way we view the world, to the entrepreneurs we partner with We understand the around the world, from how we invest importance of making a to how we operate – our approach positive impact on society. matters to all our stakeholders. 3 See page 16 14 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

We believe great ideas can change We bring resources, scale, experience, the world – addressing big societal and expertise, and they bring their needs, bringing people closer together, insight, ideas, passion, and ambition. improving their lives, making them Together, we work hard to take their more enjoyable and enriching. We company as far as it can go. believe the best ideas often start locally, with savvy entrepreneurs meeting the needs of the people and communities they understand best. And when we see those same needs elsewhere, with 18 % our backing and their ambition, they OF PEOPLE GLOBALLY USE can become global game changers. PRODUCTS AND SERVICES THAT When we invest in entrepreneurs and NASPERS HAS BUILT, ACQUIRED their businesses, it’s a partnership. OR INVESTED IN We think global “We have a unique philosophy of backing local teams. Our companies know their customers best and support and they are best placed to make the right decisions for them. But we have global scale, which allows us to see patterns everywhere and we can quickly jump local teams in and help entrepreneurs when needed.”

Bob van Dijk Chief executive Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 15

We optimise our portfolio, and “Through our investment rigorously deploy our capital – all in pursuit of growth. Collectively, we strategy we offer our manage our investments and operations entrepreneurs the support across the world for value creation over time. The profits and cash generated by and commitment to remain our businesses at scale fund both focused on their products, the development of companies we customers and business, are building and the early investments we make in promising new ventures. scale fast and seek out incremental opportunities. Where we spot opportunities to realise value from businesses we have helped Our unique approach gives We rigorously to build, we crystallise that value when investors the opportunity to it makes sense to do so. Where we see participate in some of the opportunities to accelerate the rate of growth of existing businesses or gain best available media and exposure to exciting new prospects, ecommerce opportunities manage our we invest. Where we are not confident about the future returns of a business, in high-growth markets.” or its path to success, we exit. Basil Sgourdos assets and capital Chief financial officer allocation for growth 16 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

We play a significant role in the world. Across the group we support a range We invest in and operate companies of corporate social initiatives that make in more than 120 markets and a real difference to the people and countries, with thousands of people communities who benefit from them. building products and services used by Our governance structures, code hundreds of millions of consumers of business ethics and conduct and every day. As we go about our business, various policies, provide the we take our responsibility to hold frameworks and guidance for our ourselves to the highest standards people to do the right thing. seriously.

We believe in balancing the needs of all our key stakeholders, including the entrepreneurs we partner with, the people we employ, the consumers x 7 We understand the and communities we serve, the DIVIDENDS PAID IN TAXES governments we work with, our TO GOVERNMENTS investors, and those who form important opinions about us. CORPORATE CITIZENSHIP INITIATIVES importance of The companies we build, the people ACROSS THE GROUP BENEFIT we employ and the taxes we pay all MORE THAN create value, helping to build stronger economies in the countries we invest, work and live in. 600 000 making a positive PEOPLE impact on society Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 17 Our business model

Creating value for The resources How we add value For all our stakeholders we need our stakeholders We pursue growth by building leading companies (Our six Customers that empower people and enrich communities. REVENUE capitals) Provide exciting and innovative products and services to US$ bn(1) What we do: improve our customers’ lives. 20.1 TRADING PROFIT Employees Create a compelling place (1) to work where our people US$3.4bn Partner with are engaged and motivated Financial to achieve their full potential. CONSOLIDATED entrepreneurs DEVELOPMENT SPEND We anticipate Shareholders and investors Deliver long-term shareholder US$669m changes in value through disciplined capital CORE HEADLINE EPS allocation, differentiated the world Optimise Invest execution and strong financial Human US cents around us … performance. 581 INVESTMENT IN Machine learning and artificial Suppliers and partners EMPLOYEE TRAINING Create Build businesses Treat our suppliers fairly and intelligence will soon become an sustainable integral part of everything we do. with broad drive high social, ethical and leadership potential environmental standards in the US$17m Read more on page 19 positions Note Social and products and services we buy. (1) relationship Presented on an economic-interest basis.

Local communities … and we take into PROPOSED DIVIDEND PER SHARE Invest in improving the account the views communities we operate, SA cents of our stakeholders. live and work in. 650 Manufactured Read more on pages 36, 43, TAXES PAID TO GOVERNMENTS Engaging with our stakeholders, 46 and 47 WHERE WE OPERATE understanding their perspectives and feedback. Industry Leverage our global scale to US$1. 4 bn Read more on pages 20 to 25 Focus on Address big ensure industry development high-growth societal needs ENVIRONMENT markets Grow considers and benefits stakeholders. All emissions (scope 1 and scope 2) totalled 87 022.47 (2017: Intellectual 184 458) tonnes of CO2e with property Regulators electricity the highest contributor Engage in developing dialogue of total measured emissions at and policy that support 78%. MultiChoice is the largest vibrant industries and contributor within the scoped Underpinned by our active capital allocation and strategy. benefits stakeholders. entities representing 65% of the total emissions. The carbon We ensure we optimise our portfolio for growth and competitiveness. We create value for key footprint excludes Novus which Natural Read more on page 26 stakeholders across all our historically was the largest resources businesses. contributor to total emissions measured. 18 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information Reporting on the six capitals

In line with best practice for integrated reporting, we report on the six capitals that together provide a true picture of value across the group: financial capital, human capital, manufactured capital, intellectual capital, social and relationship capital, and natural capital.

Financial capital Human capital Manufactured capital Intellectual capital Social and relationship capital Natural capital

This covers the financial This covers the skills, This covers our This covers the ideas, This covers the This covers the natural funds and assets across development, investments in the information, inventions, relationships we build resources we have an the group. opportunities and facilities and technology procedures, source code, with customers, impact on, for example, well-being of people, across the group. domains, know-how and communities, trade the energy we use and notably the thousands knowledge we create, own organisations and other the water we conserve. of people we employ and protect through, for groups we work with around the world. example, patents, and contribute to. copyrights and trademarks.

Our story in numbers. Our people story. Our infrastructure story. Our intellectual property Our social story. Our green story. (IP) story.

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. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 19 The world around us

Growth around the world Taking a long-term view at the world around us, we see key The top 10 economies measured by gross domestic product (GDP) are shown below: macroeconomic, regulatory, technology and competitive trends 2017 2022E 2017 2022 2017-2022E at work. We believe all these trends work in our favour as we (US$’bn)(1) (US$’bn)(1) rank rank growth(2) continue to pursue our disciplined high-growth strategy. 1 United States 19 362 23 505 1 1 1.9%

2 China 11 938 18 383 2 2 6.3%

Key trends Technology trends Talent trends 3 Japan 4 884 5 482 3 3 0.8% 1 Global growth is continuing The tech story is shifting from There is a global shortage of digital 4 to increase. mobile to machine learning (ML) skills, and the best people have real Germany 3 652 4 452 4 4 1.6% Machine learning (ML) is likely 2 In thinking about which platforms could choices about where to deploy to be the next transformational ignite the next cycle of value creation, their talents 5 France 2 575 3 162 5 6 1.8% computing paradigm shift. there are many emerging technologies Across the world, there is a shortage of Regulatory responses to the 3 to consider, each in a different phase digital skills, from software developers, tech revolution are material. 6 United Kingdom 2 565 2 961 6 7 1.6% of its adoption curve. While mobile to product designers, ML/AI specialists, Global shortage of digital talent. 4 platforms are maturing, ML is entering cloud computing specialists, digital the phase of mass adoption. After marketers and digital content creators. 7 India 2 439 3 924 7 5 7.7% Macroeconomic decades of overpromising, ML is finally This competition is increasingly global, starting to deliver real-life benefits as a with talented people being courted 8 Brazil 2 081 2 629 8 8 1.7% trends confluence of factors drives by global players and having the development. Many new winners can opportunity to work outside their Global growth is continuing be created by applying ML to distinct home country if they choose to do so. 9 Italy 1 921 2 244 9 9 1.1% to increase problems. As such, all our portfolio Additionally, the structure of work is companies will seek to integrate ML changing, and individuals no longer The global upswing in economic activity 10 Canada 1 640 2 052 10 10 2.0% continues to strengthen. In 2016 global tightly into their business processes. strive for the relative security of a big growth was 3.2%, the weakest since organisation, often preferring to be the 2008/9 global economic crisis. It self employed in the ‘gig economy’ or For reference: was projected to rise to 3.6% and 3.7% Regulatory trends having the confidence to start their in 2017 and 2018 respectively. Financial own business straight out of university. 12 Russia Regulatory responses to the tech In this environment, employees are 1 469 1 805 12 12 1.6% conditions remain upbeat across the revolution are gaining momentum world, but the sustainability of the likely to change employers much more global recovery remains vulnerable. Regulations affecting our business are frequently than in the mid-late 20th 24 Poland 510 698 24 23 3.0% increasing globally. century, and expect a compelling proposition from their employer 29 Nigeria 395 633 29 25 1.6% PROJECTED GLOBAL GROWTH Responses to the evolving geopolitical where they can learn and grow within RISE FOR 2018 and macroeconomic environment and a relatively flexible structure. To be the transformational technological successful, digital companies must be 33 South Africa 344 419 33 36 1.7% (r)evolution will continue to gain impact. effective at competing for and retaining We invest in high-growth markets as talented people. Source: International Monetary Fund World Economic Outlook Database (October 2017), issued 10 October 2017. a global partner empowering local Notes entrepreneurship, with genuine local E – Expected. impact and value creation – including (1) GDP in US dollars at current prices. % employment, innovation and financial (2) Average annual growth rate of GDP, represented in national currency at constant prices, over six years. 3.7 contribution. 20 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information Engaging our stakeholders

Building constructive relationships with our key stakeholders is critical to our business. We are focused on long-term success and making a lasting The issues that difference around the world. It is about creating sustainable value in the matter most broad sense. A sense that plays out across the six capitals and considers, Return on investment We closely manage our assets and engages and involves all our stakeholders. capital allocation to deliver strong returns on investment.

Our key stakeholders and why they matter to us Tax We take a responsible approach to tax, making sure we pay full and fair taxes in Government local jurisdictions around the world in Customers Employees and regulators order to contribute positively to communities. Our products and services are enjoyed by Our employees are at the heart of our We recognise how important it is to work Privacy and cybersecurity millions of customers around the world – success – their commitment and with governments and regulators, particularly We focus a great deal of expertise and from individuals to businesses. We want to entrepreneurial drive make all the difference. given that many of our businesses have such a resources on ensuring privacy and delight them. big impact on people’s lives. cybersecurity for our customers and Talent development and across our group. CUSTOMERS NUMBER OF EMPLOYEES KEY RELATIONSHIPS transparency We are committed to increasing the Dedication to increasing Government, Quality of user experience skills and capabilities of all our people customer satisfaction sector organisations, Our businesses focus on making their to advance their careers and contribute 24 887 products and services as easy, enjoyable as much as possible to Naspers. industry bodies and useful as possible for our millions of NUMBER OF MARKETS AND COUNTRIES customers around the world. Increasing customer Trust and fraud satisfaction >120 Across our group we focus a great deal Throughout our group we build trust on understanding and meeting the with our customers, colleagues and needs of our customers. In our video- communities by behaving openly and entertainment business for example, our Shareholders Industry and business responsibly and actively tackling key Society strategies are rooted firmly in customer and investors partners threats such as online fraud. centricity and our belief that the better we can serve the customer, the more We are a for-profit organisation We want to be an industry leader that works We are committed to making a lasting Competition and M&A sustainable the business will be. committed to growing and increasing closely with partners across the group. positive impact. We want to make a We seek to compete successfully and value for our investors. difference to society, the world we live in. fairly around the world, complying with Gaining insights international and local competition law. We also believe that improving our SHAREHOLDERS AND INVESTORS TYPES OF CAPITAL PROVIDERS TYPES OF CAPITAL PROVIDERS customer satisfaction score (CSAT) Remuneration will increase customer lifetime value. Strategic focus on good Industry associations, Public, media, We remunerate our people CSAT provides customer insights in returns long term authorities and suppliers, competitively in order to attract and addition to other business metrics commissions NGOs retain top talent and reward them well that are normally evaluated as part of KEY RELATIONSHIPS for their performance and contribution business performance. These insights to Naspers. are crucial in aligning internal activities Indices, to meet customer expectations and stock exchanges deliver against our promises across the customer journey. This in turn is key to yielding a higher return on investment. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 21

Engaging our stakeholders continued

Ensuring the best service SuperSport drives the biggest revenue Investor day on the DStv platform and the majority of its customer base is on the Premium On 12 December 2017 we held an Investor subscription. The focus here is on: Day in New York. The event was attended by more than 130 investors with another 234 via • Retaining customers. webcast. The subsequent four weeks saw • Keeping customers happy by another 474 people viewing the uploaded delivering superb customer-service version of the events on our website, bringing experience. the total number of participants/attendees • Creating a bigger potential subscriber one month later to 708. The day was hosted growth by word of mouth due to the by Bob van Dijk and Basil Sgourdos, with service delivered on calls and social support from segment management who media platforms. delivered presentations and answered • Ensuring customers are the centre of questions about online classifieds, payments, the business and therefore deserve etail, ventures and online food delivery, and the best service from us. video entertainment. The Investor Day was an opportunity to provide more information Striving for excellence about our strategy, business objectives, and We strive to serve the customer with the key targets against which performance excellence (80% CSAT). can be measured. • Call listening sessions are done every “Overall, the presentation gave week between team leader and agent to assess the service to the customer us more comfort on the and give coaching where needed. growth and profitability • Call reports are sent to all senior outlook of the classifieds, management to address any complaints, with departments payments and food-delivery accountable for the complaint. businesses in particular. It also • Screening and training are carried out for all additional employees who assist provided greater reassurance when there is a shortage or influx of on management optionality work volumes, for example during to narrow the discount special events, or live sporting events. • Specialised employees assist with through greater disclosure, email queries, ensuring a 24-hour improved liquidity (to access turnaround. • Workforce planning supports staffing new pools of capital) requirements and scheduling. and greater engagement • We ensure employees are truthful and represent the business’s best with shareholders.” interests when interacting Source: with customers. Naspers Ltd (NPNJ.nJ): Key takeaways from the Investor Day. Goldman Sachs Global Investment Research 13 December 2017

Engaging our investors. 22 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Engaging our stakeholders continued

Material stakeholders How we engage with them Main issues Our response Capital impact

Customers and users • Call centres • Good customer/user service and experience • Continuous improvement of range of products, customer experience, pricing • Electronic communication (email, sms, apps, web (fast delivery, return, feedback). and product range by our group businesses, for example: platforms and social media platforms) • The right/competitive pricing and range ––eMAG: • Showrooms of products. • Loyal client campaigns with special discounts. • Surveys and market research • Content preference. • 24/7 call centre service. • Trust and safety. • Sales consultants in showrooms. • Data privacy. • Diverse delivery options, including free delivery over certain amounts and a two-hour delivery option. • Net Promoter Score monitored regularly: FY17 62% FY18 59%

• The trend is declining, as marketplace share is growing and the customers rank the experience as being poorer. eMAG is working on several projects to reverse the trend: ––seller performance monitoring – we will inactivate the sellers with poor performance ––seller training ––1P on time delivery focus, and ––1P customer service focus. ––Movile: • Responded to 100% of complaints and 70% of customers believed the problem was solved. • Dedicated product teams. • Initiatives to address content preference, for example: ––Media24: Feedback from readers taken into account by editorial teams in content planning. Letters to editors are published and editors respond to readers. ––Video entertainment: Deep viewership analysis supplemented by regular consumer research and customer feedback drives content decisionmaking. • Initiatives to address trust and safety concerns, for example: ––OLX: Created a global trust and safety programme and launched initiatives to promote online safety, including workshops and social media communications. ––PayU: A communication and awareness programme on trust and safety issues relating to consumers and merchants is in place. The programme communicates preventive measures in place at PayU and is designed around privacy, phishing, fraud detection, balance protection and tips for online shopping. • Naspers has a data-privacy programme led by the head of data privacy, and adopted a group cybersecurity policy. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 23

Engaging our stakeholders continued

Material stakeholders How we engage with them Main issues Our response Capital impact

Employees • Meaningful work: Our people join us because they • Global shortage of digital talent. • We believe that diverse teams produce the very best results and we are committed want to make a difference. We work on designing • Business restructuring. to creating workplaces that are inclusive and welcoming to people of diverse origins, jobs and organisations that create a line-of-sight • Employee retention. preferences, backgrounds and perspectives. between individuals and the impact they have. We • Diversity. • Continuous conversations between people and their managers on performance, have a performance culture, and we strive to ensure career development plans and recognition. that individual effort is aligned with business • Fair, responsible and competitive pay practices: group companies operate in objectives. We encourage ongoing conversations framework established by the Naspers human resources and remuneration between our people and their managers in this committee. (Refer to the Naspers good governance guidelines). respect. We offer relevant compensation packages • Clear and regular communication on businesses’ performance and strategy by that allow us to compete for talent and reward the leadership. best performers. • Analysing employee engagement results and formulating plans and allocating responsibilities to improve employee confidence and build an engaging work • Development: Our people stay because we offer them environment. the opportunity to learn and grow professionally. On • Diversity awareness programmes; women’s development programmes. the job, we seek to provide our people with new • Dealing with business restructuring fairly and transparently, and supporting experiences and the opportunity to use their skills employees who are required to transition out of the organisation. in different ways. We encourage our people to create personal development plans, supported by their managers. Through MyAcademy across the group, and additional efforts within each business, we offer our people relevant formal learning opportunities. • Culture and leadership: We work hard to preserve a culture of entrepreneurship, with open and honest communication and inspiring leadership. We believe that the experience of our people is heavily influenced by their direct manager and we are investing in the quality of people management across the group. We create forums for the exchange of information and ideas, eg onboarding sessions for new people, internal websites, ‘all-hands’ meetings with leadership, networking sessions across the group, organised by skillset and region. Where appropriate, we also engage formally through employment equity forums (South Africa) and workplace forums, work councils and trade unions. 24 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Engaging our stakeholders continued

Material stakeholders How we engage with them Main issues Our response Capital impact

Investors and • Annual financial statements • Strategy to sustain good past returns over the • Increased engagement with our shareholders (Investor Day, remuneration outreach). shareholders • Interim and provisional reports long term. • Enhanced disclosure and transparency. • Financial results presentations • Holding company discount. • Enhancements to our remuneration policy. • Annual integrated report and interim reports • Perceptions of poor governance around MCSA/ • Disciplined capital allocation and taking action where we are not seeing expected • Press and SENS announcements ANN7 issue. returns. • Reporting via corporate website and corporate • Remuneration policy and disclosures. • Communicating our approach to capital allocation and the returns it is delivering. documents (factsheet) • Control structure. • Scaling our ecommerce investments towards profitability and stabilisation of VE • Investor meetings and teleconferences • Investment and development spend. in SSA. • Investor Day • Video Entertainment (VE) in sub-Saharan Africa • Continued investment in the investor relations (IR) function. • Business visits (SSA) turnaround prospects. • Dedicated email communications • Negative free cash flow. ([email protected]) • Share option dilution and liability. • Directors are available at the annual general meeting • Strategy for online food delivery. to respond to queries

Governments and • Participation in advisory committees, meetings and • Acquisitions and corporate market definitions. • Provide structures and detailed programmes to ensure compliance with all applicable regulators public consultations • Consumer rights. laws and regulations. • Formal meetings and roundtables • Data protection and privacy. • Formal representations and written submissions to express views. • Response to sector and company-specific enquiries • Intellectual property. • When invited or relevant, proactive discussion about future legislation in the form • Participation in sector and industry associations and • Employment and social regulations. of expert advice, based on experience globally or technology and sector expertise. international fora • Taxation. • Invest in group capability and capacity to respond to inquiries, requests and interest • Site visits (host official delegations) • Free and global trade and investments. in future legislation on issues affecting industry. • Integrated annual report and public announcements • Corporate social responsibility. • Express views through media engagement and public speeches. • Policies and regulations affecting our businesses, including: media, video entertainment, technology, ecommerce and financial services.

Media • Interviews, particularly around key announcements • Naspers financial performance. • Created press office to provide faster response to inbound media enquiries. (eg results and significant transactions), and events • Strategic focus. • Proactively building media interview schedules and access to key management to (eg the AGM and Investor Day) • New investments, M&A and divestiture activity. provide context and background information in support of strategy and important • Whenever possible, providing comment and • Activities of our companies and associates. news (eg results, significant transactions). information in response to media enquiries to our • Weighting on the JSE. • Responding to requests for comment, participating in events and publishing press office • Holding company discount. commentary, as appropriate, in line with communications and IR policies. • Provision of press releases, editorial and articles • Control structure. • Held a joint press conference with MCSA in January to communicate the findings relating to the activities of Naspers and its companies • Perceptions of poor governance mainly due to of the MCSA review. • Provision of reporting, news and thought leadership MCSA/ANN7 issue. through the company website and Naspers channels, • Remuneration policy and disclosures. on Medium and LinkedIn • Reliance on Tencent. • Background and contextual conversations, use of right of reply, and where necessary, corrections of inaccurate reporting Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 25

Engaging our stakeholders continued

Material stakeholders How we engage with them Main issues Our response Capital impact

Communities • Through our corporate social investment (CSI) • Local employment and value creation, including • Corporate social responsibility programmes in the group such as Video programmes supporting local business. Entertainment’s MultiChoice Diski Challenge, Magic in Motion Academy and • Public announcements and website • Adherence to local laws and paying taxes due. SuperSport Let’s Play; Media24’s flagship corporate social responsibility project, WeCan24, offering digital journalism training to high school learners and teachers; eMAG foundation, which supports education and programmes that facilitate the access to education, for pupils and students; and others. • Developing products/services to meet societal needs, for example food delivery (iFood and Swiggy) and education (Codecademy and Brainly). Trading through online platform OLX by purchasing secondhand products lowers carbon emissions. • Focus on hiring local employees, building local talent. • The Naspers groupwide legal compliance programme is adopted by group businesses, tailored to unique risks and local laws (refer to pages 65 and 66). • Board-approved group tax policy and tax disclosure in integrated annual report (refer to pages 29 and 30).

Business partners • Meetings, calls and electronic communication • Keeping abreast of relevant developments in the • Respectful engagement. business. • Maintaining good relationships and regular communication with key management and • Their rights, including in relation to pricing, content, business representatives. platform use, privacy and security. • In the event of disputes, appropriate dispute resolution management. • Negotiating relationship and agreement terms and requirements within agreed mandate. • Where necessary, refining business approach in line with international norms 26 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information Active portfolio management

Optimising our portfolio to deliver growth and competitiveness.

Capital allocation strategy by the investment committee, We have a systematic approach comprising senior executives with to how and where we allocate board-approved authority levels. our capital. We typically invest in Sizeable transactions go to the board new businesses early on, focusing for consideration and approval. on opportunities that address big, Public societal needs and have potential Our strategic priorities to scale globally. Profitable In recent years we have relied on video entertainment to fund our activities; in If we have evidence of good traction future, we aim to diversify our sources and sustained growth, we often of cash by progressively moving our ‘double-down’ on existing investments, Play to win Value core ecommerce assets into profit. helping them build scale and market appreciation leadership. Once we are comfortable Overall, our priorities for the next about a compelling proposition, Operate for few years include: we go ‘all-in’, driving these businesses to return and cash • Drive ecommerce to profitability. profitability and cash generation, • Continue to pursue scale in our core for example Classifieds. Proven segments Scale to full potential (classifieds, online food- and profitability delivery and payments businesses We also have businesses that are globally). mature, profitable and cash generative, • Optimise value creation for such as MultiChoice South Africa. In non-strategic assets. addition we have invested in a number • Plant the seeds for longer-term of companies that are public, such as Committed growth by selectively investing in Tencent, Mail.ru, MakeMyTrip and most investment new growth opportunities with recently, Delivery Hero. high potential. Investment criteria During the course of a year, we look at Potential numerous investment opportunities, but we apply strict criteria and are selective about where we invest: US$ bn • We look for business models that 9.8 address big societal needs and have REALISED IN REDUCING STAKE IN TENCENT potential to scale globally. Experiment (R&D) FROM 33.17% TO 31.17% • We partner with credible and expand entrepreneurs and teams with vision, ambition and tenacity. • We are disciplined in our valuation US$369m approach using fundamental techniques such as discounted cash TRADING PROFIT – UP 29% (24% IN LOCAL CURRENCY flow analysis and we focus Ventures EXCLUDING M&A) FOR THE VIDEO-ENTERTAINMENT SEGMENT on anticipated return on invested capital. 5+ years away 3-5 years away from full potential Cash generative • Proposed transactions are reviewed Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 27

Capital performance snapshot Manufactured Social and relationship

From offices to warehouses to technology, we invest We place considerable emphasis on building strong How we performed against our in and maintain a range of infrastructures across the relationships with customers, communities and other group. iFood uses artificial intelligence and machine stakeholders across the group to ensure we have a six types of capital in 2018 learning to reduce delivery times. They can deliver the long-term positive impact on societies. pizzas far quicker – in 10 minutes, rather than 40. PayU focuses on protecting its valuable assets, notably its ONE OF THE LARGEST TAX CONTRIBUTORS IN local payment platforms and data. SOUTH AFRICA – PAID AND COLLECTED INVESTMENT IN CAPEX (US$’m) US$772m Financial Human – talented people CORPORATE CITIZENSHIP INITIATIVES (REFER TO HOW WE ENGAGE WITH OUR We manage our finances rigorously to maximise We are committed to supporting and encouraging all performance. In 2018 we performed strongly, our people to develop their skills and capabilities to the STAKEHOLDERS ON PAGE 20) with significant growth in core headline earnings. full. In 2018 we delivered on this commitment in a CUSTOMER SATISFACTION NPS SCORE OLX established a global trust and safety number of ways – from individual talent development (1) (1),(2) programme to act as the glue for all trust REVENUE TRADING PROFIT programmes to global resources such as MyAcademy. and safety initiatives. (US$’m) (US$’m) 80% NUMBER OF EMPLOYEES DEVELOPMENT SPEND(1) (US$’m) Intellectual property Natural resources

MYACADEMY We look for and back innovation across the group, Across the group we endeavour to minimise the impact making sure we protect the resulting intellectual on the environment. ACTIVE LEARNERS CONSUMED property and make the best use of it. In 2018 we MORE THAN continued to encourage, invest in and protect BUSINESSES THAT REDUCE ENVIRONMENTAL

(2) innovation, with 50% of businesses introducing or IMPACT CORE EPS (US$) enhancing innovative new products and services. 26 000 In FY18 Takealot introduced 100% recycled ONLINE LECTURES AND ENGAGED BUSINESSES DRIVING INNOVATIVE delivery packaging. IN MORE THAN PRODUCTS AND SERVICES GREEN BUILDING Each year eMAG holds a hackathon – 24 hours 43 000 The MultiChoice City building in Johannesburg has Notes when coders unite to code something amazing, (1) Presented on an economic-interest basis. HOURS OF TRAINING impress the judges and win great prizes. It is an a 5-Star Green Star rating from the Green Building (2) Prior periods restated for the group’s change in calculation of core Council of South Africa. headline earnings and trading profit regarding Tencent’s digital excellent way to attract the best tech talent to content amortisation. a business with a strong focus on intellectual property (IP) that likes to develop its Media24 in Cape Town is implementing GROWTH IN CORE HEADLINE EARNINGS own software. water-saving and resilience initiatives, running awareness campaigns, and developing plans to OLX rigorously protects its IP, defending the work differently to use water responsibly. 72% assets across more than 40 countries. PROPOSED ANNUAL GROSS DIVIDEND INCREASED (GROWTH IN SA RAND TERMS) 12 % 28 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information Value creation

Naspers creates value for key stakeholders through its business model, drawing from its six capital pools. Our key value-creation outputs for the group, its stakeholders and society are illustrated below.

Employees Investors Government

SALARIES, WAGES AND EMPLOYEE FINANCE COST PAID DIRECT AND INDIRECT TAXES PAID BENEFITS US$ m US$ bn US$1.4 bn 267 1.4

INVESTMENT IN EMPLOYEE TRAINING DIVIDENDS PAID TO NASPERS SHAREHOLDERS US$ 17 m US$ 185 m PERMANENT EMPLOYEES 24 887

Value creation Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 29

TOTAL TAX PER TAX TYPE (SA ONLY) The Naspers group is one of the largest tax contributors in South Africa. In FY18 Naspers paid and collected Tax Amounts collected on behalf of tax authorities R8.8bn (US$772m). This accounts for Amounts paid to tax authorities 55% of taxes paid and collected by the group globally. Naspers aims to contribute positively to the US$’m In the absence of readily available public communities within which it operates. As a global Customs and excise, 7 ad valorem data, we conducted our own research to estimate our total tax contribution company, we recognise that the tax we pay is an Other taxes and grants 1 versus the contribution of South African peers. Using FY17 tax data to conduct important element of our broader economic and social Withholding tax 13 (entity cost) the comparison (as most of our peers’ contribution to the countries where we operate. FY18 figures were not publicly available Other taxes and grants 25 yet), the analysis shows that Naspers is among the top 10 largest taxpayers in Labour/Employee taxes 164 South Africa. If levies and excise taxes are excluded, Naspers ranks as South Corporate income tax/ 292 Africa’s sixth largest tax contributor. We always aim to comply with tax laws effective tax rate for FY18, excluding Taxes will be paid as the group declares Profit tax in all countries where we operate and once-off gains from extraordinary dividends to its shareholders, while VAT/Consumption taxes 270 Naspers, through its tax contributions, manage our tax affairs in the interests transactions and including the taxes capital gains tax will also be levied on is able to contribute to the funding of of all our stakeholders, including accounted for by our associates, is 36.8%. shareholders when they sell their shares national social objectives. As an illustrative governments and our shareholders. in Naspers on any gain in value as a example, Naspers’s total FY17 tax Our tax principles are laid down in the This year the group disposed of a 2% result of reinvesting funds. contribution is able to fund 7 571 Naspers group tax policy which is interest in Tencent, which constitutes an Companies under review additional educators, 1 758 hospital beds, available on our website. extraordinary transaction. Under the Our most established and mature 471 doctors and 4 913 low-cost houses. participation exemption that applies to businesses are in Africa and provide Tax con- This is based on the assumption that Naspers businesses pay taxes where all South African corporates, and which video-entertainment services to Tax contribution (R’m) tribution Ranking Naspers’s total tax contribution is they operate and, consequently, where exists to ensure there is no double consumers. On behalf of tax authorities (R’m) distributed in the same proportions as revenues and profits are generated. We taxation of profits, tax is not applicable Naspers paid and collected more than National Treasury’s sectoral allocation in invest in businesses in many countries to capital gains on the sale of shares in a US$935m on the African continent. (excluding the 2016/17 budget. Naspers, as a and, in an increasing number of foreign entity as long as the seller held More than 67% of taxes paid and fuel, reputable and tax compliant business, also countries, our businesses monetise, and more than 10% of the company at the collected globally over the past year alcohol helps the South African Revenue Service in some, such as in South Africa and time of the sale and the buyer is not were paid to tax authorities in Africa. Direct Indirect Total and (SARS) to ensure collection and reduce Poland, we have major operations that (controlled by) a South African resident. tobacco collection costs. In these ways, Naspers’s are profitable. levies) tax contributions are an enabler to the national economy and play an important In FY18 taxes paid and collected* Peer #1 11 950 5 623 17 573 14 058 (2) role in South Africa’s socio-economic by Naspers globally added up to Illustrative example of social benefits if National development and upliftment. US$1 389m. The contribution to the Treasury allocates the total tax contribution (including Peer #2 2 188 14 601 16 789 4 787 (8) fiscus of the individual businesses is in In Europe, the group paid and collected line with the state of maturity of the induced tax contribution) based on the FY2016/17 Peer #3 8 960 8 025 16 985 16 985 (1) US$252m (18% of tax paid and collected businesses. More mature businesses budget speech allocation. globally), driven by the group’s profitable often pay more tax than less mature Peer #4 9 931 1 757 11 688 11 688 (3) internet operations in Eastern Europe. ones as the latter are often still in a A number of these businesses are in loss-making phase having not reached EDUCATORS LOW-COST HOUSES Peer #5 5 760 4 369 10 129 10 129 (4) their development phase (ie are growing their full potential. We continue to invest fast), but typically are not yet profitable to grow and scale these businesses. Peer #6 7 395 1 100 8 495 8 495 (5) or at full potential and therefore still Once the developing businesses 7 571 4 913 loss-making. As these businesses scale become cash flow positive and profit Peer #7 4 043 4 201 8 244 4 004 (9) and deliver profits, they will start paying generative, in most cases tax-loss carry taxes in their respective countries. forwards are first utilised before profits HOSPITAL BEDS DOCTORS Naspers 4 249 2 968 7 217 7 217 (6) become taxable. * Amounts paid to tax authorities consist of corporate income tax, withholding tax, customs, Peer #8 4 886 1 292 6 178 6 178 (7) and other similar taxes borne. Amounts collected Naspers has a meaningful effective tax 1 758 471 on behalf of tax authorities consist of indirect taxes rate. The consolidated tax rate has like VAT, service taxes, employee taxes and other Peer #9 2 227 1 146 3 373 3 373 (10) consistently been higher than 30% of similar taxes. profits for more than 10 years. The Peer #10 2 464 254 2 718 2 718 (11) 30 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

TAX PAID AND COLLECTED PER GEOGRAPHICAL AREA Taxes paid in Asia and Latin America, Tax where most of our businesses are still in continued the development phase and therefore Total Amounts paid to tax authorities Amounts collected on behalf of tax authorities loss-making, amounted to US$187m US$’m 15 (13% of tax paid and collected globally). Other 5 In Asia we are net recipients of tax inflows 11 primarily due to VAT and indirect tax Tax paid and collected in FY18 252 refunds while our businesses are still Europe 66 loss-making. This position will change as SA vs the rest of the world 186 our businesses scale and deliver profits. 108 AMOUNTS COLLECTED ON BEHALF OF AMOUNTS PAID TO TAX AUTHORITIES Asia 45 The largest taxes are those we pay TAX AUTHORITIES 63 domestically in the countries we 79 operate in and primarily relate to VAT Latin America 33 and consumption taxes, corporate 46 income tax and taxes withheld on 163 behalf of our employees in the Rest of Africa 90 respective countries. 73 US$ m US$ m 772 Video entertainment, as our most 814 575 South Africa 337 mature segment, pays the highest taxes. 435 The group has an increasing number of US$’m 200 400 600 800 1000 profitable ecommerce entities which SOUTH AFRICA SOUTH AFRICA drive the taxes paid in ecommerce. As we continue to scale our ecommerce TAX PAID AND COLLECTED PER TAX TYPE segment and add more profitable US$435m US$337m businesses, these taxes will increase. Total Amounts paid to tax authorities Amounts collected on behalf of tax authorities US$’m While our media business in South REST OF THE WORLD REST OF THE WORLD Customs and excise, 26 ad valorem Africa is seeing a decline in its legacy print operations, it is making substantial Other taxes and grants 37 investments in a number of digital and US$379m US$238m Withholding tax online growth opportunities. After 47 (entity cost) the sale of Novus Holdings, the media Other taxes and grants 130 business is loss-making. The businesses employ 3 719 (2017: 3 848) salaried Labour/Employee taxes 284 employees; 28 (2017: 1) waged Corporate income tax/ 372 employees and 209 (2017: 343) Profit tax temporary workers in South Africa and, VAT/Consumption taxes 493 despite incurring losses, still collect a US$’m 200 400 600 meaningful amount on behalf of tax authorities.

TAX PAID AND COLLECTED PER SEGMENT With businesses in some of the most exciting markets in the world, and a Total Amounts paid to tax authorities Amounts collected on behalf of tax authorities focus on long-term growth, we are US$’m US$’m US$’m proud of the significant contribution 81 Brazil 33 Russia 40 we make to the communities we serve Media 66 globally, and society at large. Ghana 10 Mauritius 33 15 Kenya 14 Brazil 20 97 Corporate Nigeria 17 Nigeria 20 59 38 Poland 38 The Netherlands 19 404 Romania 97 Romania 15 Ecommerce 273 Russia 48 Poland 18 131 The Netherlands Namibia 28 10 Video 808 Zambia 9 Argentina 7 Entertainment 417 391 Rest of the world 86 Rest of the world 55 US$’m 200 400 600 800 1 000 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 31

Performance review

Rio de Janeiro, Brazil 32 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Building on the successes of previous years and continuing to execute our disciplined growth strategy, we performed strongly across our portfolio of internet, video-entertainment and media businesses. Rising internet revenues, increasing video-entertainment subscribers, smart investments in society-changing areas, award-winning journalism on important issues – we enjoyed many successes across our three segments.

(1) % 79of group revenue now comes from our internet and ecommerce activities

No.1shopping/lifestyle apps in more than 22 countries

Note (1) On an economic-interest basis. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 33 Internet

From platforms that make communicating, INTERNET REVENUES GREW 50% TRADING PROFIT ROSE 50% THE INTERNET SEGMENT NOW WE INCREASED OUR FOCUS ON entertainment, shopping and paying for things easy, (51%) TO (56%) TO CONTRIBUTES AND INVESTMENT IN safe and enjoyable to specialised ecommerce services key high- (1) (1) growth areas such as great local online food delivery – we focus on US$15 .9 bn US$3.1bn 79 % high-growth internet businesses that make a lasting Note such as food delivery fuelled by ecommerce and Tencent’s (1) of group revenue, up from remarkable results Presented on an economic- 73% last year positive difference to people around the world. interest basis.

Highlights of the year

Classifieds Payments Online food Etail Travel Ventures Social and

OLX continued to grow PayU enjoyed healthy delivery We achieved strong MakeMyTrip strengthened We continued to invest in internet around the world and growth, with total payments growth across all our etail its leadership in India. In its key opportunities such as turned profitable and free volume exceeding We continued to invest businesses and eMAG’s third quarter, MakeMyTrip edtech. Post year-end we platforms cash flow positive in the US$25bn, and made key in this promising sector, Romanian business became delivered 94% year-on-year invested US$35m in Honor, year (excluding letgo). investments in Kreditech including a 22% stake profitable. (Post year-end growth on revenue less a mid-stage home-care Tencent continued to excel and Remitly. in Swiggy and 23% stake we signed an agreement to service costs, while company that helps older in China. in Delivery Hero. Revenue sell our stake in Flipkart for improving operational adults live safely and for iFood was up 121% year US$2.2bn, representing an efficiencies. comfortably in their own Mail.ru strengthened on year. internal rate of return (IRR) home by enabling reliable its position as Russia’s of 32%). and high-quality care. number 1 internet group.

Read more on page 34 Read more on page 35 Read more on page 37 Read more on page 37 Read more on page 39 Read more on page 39 Read more on page 40 34 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Markets Our businesses Classifieds Payments Online food Etail Travel Ventures Social and delivery internet Indian ecommerce Online payments in emerging platforms The Indian ecommerce market is still in markets its early stages of development and Online payments in emerging markets continues to hold significant long-term are expected to grow twice as fast as in potential. With growing (mobile) mature markets. Two key factors are internet penetration and a shift from driving this growth: the regulatory push offline to online retail, India’s online towards cashless payments, eg UPI in retail market is expected to grow India, and accelerating online by a 22% compound annual growth cross-border payments, expected to be rate (CAGR) to US$68bn by approximately 30% of the ecommerce 2021 (Euromonitor). volume by 2020, up from approximately 20%. Against this backdrop, the South African online retail payments industry saw over US$40bn South African online retail presents a of global M&A in 2017. substantial opportunity. From 2016 to 2021 it is expected to grow at 15% Chinese growth annually. Low rates of internet China’s internet population grew at 6% penetration (58% in 2017) and online this year and reached 772m by the end retail penetration (1% in 2017) suggest of 2017. significant offline-to-online migration will propel this growth.

Big opportunities SPOTLIGHT characterise the internet Performance Building trust across ON OLX markets we focus on. our marketplaces Classifieds #1 It is a high-growth game We are committed to building ensure consistent and effective shopping/lifestyle trustworthy online combating of fraud. apps in more than and we are a meaningful REVENUE(1) (US$’m) marketplaces. Trustworthiness is 22 countries key to the long-term success of The group invests heavily in global player. these marketplaces and of great advanced technology to monitor value to customers and platforms, as well as in teams 80% IFRS: 47% LC: 35% merchants alike. around the world to prevent of person-to-person inappropriate listings. For online trade in TRADING LOSS(1) (US$’m) OLX has established a global example, it has built an India is done through trust and safety programme automated moderation tool, OLX 2018 (114) (under the auspices of the Hermes, which has increased the 2017 (328) general counsel) to act as the successful automatic moderation IFRS: 65% LC: 59% glue for all trust and safety of illegal or bad content by up to 25% initiatives around the globe and 80% in some countries. of the Russian Notes population uses (1) Presented on an economic-interest basis. Avito every month LC = local currency. We’re investing in online trust and safety for customers around the globe. 75m downloads and hundreds of millions of listings added by users Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 35

Classifieds continued

OLX (excluding letgo) continued to The group continues to invest in mobile grow around the world and this year apps for trading consumer goods, such as returned a profit to Naspers Protecting intellectual OLX and letgo, and adjacent cars and With more than 330m monthly users property real estate vertical platforms to serve worldwide, OLX group’s mission is to markets where there is a high level of make it as easy as possible for people to OLX rigorously protects its intellectual property, maturity. By consolidating expertise into buy and sell almost anything. This fuels notably the source code and domains that are regional hubs, OLX increased efficiency local economies. Through consumer at the heart of its global brand. This involves and scalability while realigning investment brands, including Avito, Dubizzle, letgo, defending the assets across more than levels to match opportunities in some OLX and a dozen others, more than 40 countries. local markets. 15m items are exchanged on OLX’s platforms every month. We have a very active and successful team of Across its markets, OLX is investing in IP experts (Naspers IP team and the domain and experimenting with innovative OLX is building an enduring business office in Naspers) to monitor and act against trading formats to use local market by striving to offer buyers and sellers any IP infringements. knowledge and solve customer flawless user experiences, through problems. The group has started to intelligent technology and convenient For sharing of open source code, our developers operate a very popular payment and services. are being trained by our Naspers head of IP and delivery service in the Ukraine, and OLX general counsel to ensure that minimum continues to explore new verticals The group is expanding monetisation standards are followed for sharing open source including Shedd for fast fashion and in Russia, the UAE, Poland, Portugal, code and to ensure that we do not provide our Tradus for heavy machinery. Romania and the Ukraine, deepening proprietary code to the open source community. relationships with professional sellers We encourage responsible open source code through local commercial operations. sharing, under licence, to ensure that our Payments OLX revenues have shown solid developers are engaged with the outside growth in the past years and this year developer world. This increases our profile as REVENUE(1) (US$’m) the group returned a profit to Naspers, a group among tech talent as an attractive place excluding investments in letgo. to work. OLX is enhancing product centricity. Across the group we protect our brand, domains IFRS: 58% LC: 37% The group is applying machine learning and trademarks aggressively and we have seen and artificial intelligence to enhance the great success in our efforts to reduce infringement. (1) user experience, including features like TRADING LOSS (US$’m) image recognition and multi-language smart chat. Three important acquisitions were IFRS: 7% LC: 42% made in the year: AutoTrader, the leading car vertical platform in South Notes Africa, and Expat Wheels and (1) Presented on an economic-interest basis. LC = local currency. Wecashanycar in the UAE. The latter two complement the group’s local PayU enjoyed healthy growth Dubizzle platform in offering a total of and is expanding its fintech offer three car selling options designed to bring more convenience to buyers and With operations in 17 high-growth increase revenue for sellers. markets, five of which are among the top 10 fastest-growing payments markets globally, PayU is ideally One of the key distinctive positioned to benefit from the strong strengths of OLX is that it market opportunities. is a global business that We’re defending intellectual property In the year, PayU recorded healthy is extremely localised in across more than 40 countries. revenue growth shown above, driven each of its 41 markets. by a 48% increase in transactions processed to over 650m. TPV exceeded US$25bn, more than doubling in the last two years. 36 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Payments continued

PayU grew while containing costs in the SPOTLIGHT core business, principally by achieving Enabling a borderless Protecting valuable assets scale efficiencies. Consequently the (1) trading loss as a percentage of revenue financial world improved significantly – reducing to 58% PayU focuses on protecting its valuable PayU revenue assets, notably its local payment 22% from 37% last year. PayU’s aim is to enable a growth in 2018 borderless financial world in platforms and data. The platforms are It was also a critical year to transform which everyone can prosper. largely developed inhouse and are PayU from a payments business into a To this end the company focuses crucial to the company’s performance broader fintech financial services on making sure payment US$ and potential. business. PayU launched credit products transactions are frictionless in India and Latin America, invested across mobile and other >25bn To protect assets, PayU has US$99m (and €20m in convertible loan PayU total payment comprehensive risk management and platforms. This benefits both volume in 2018 funding) in Kreditech, a credit-scoring consumers and merchants. internal controls in place ranging from business, and US$100m in Remitly, a increasingly harmonised platform development processes and technology-driven remittance business. Innovative technology, developed Note PayU is partnering with both companies inhouse as well as through (1) On an economic- governance to ethical hacking exercises to deliver credit and remittance investments and strategic interest basis. and a continued focus on automation solutions in its key markets. partnerships, empowers many to facilitate standardisation. people and merchants to buy Growing across fintech and sell online, extending the It is an exciting time for PayU. Looking reach of financial services. ahead, as well as continuing to grow the size and value of the payments business, The company is also working on PayU will also increasingly focus on increasing digital inclusion in other key fintech areas, notably credit, other ways, for example access for example by offering quick and easy to alternative sources of credit. technology-based sources of funding to Technology can do a great deal underbanked people. to free up and improve the speed and convenience of lending to underbanked people who would make good use of funds if these were readily available.

PayU wants everyone to be able to prosper in a borderless PayU has comprehensive protection financial world. for its payment platforms and data. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 37

Online food delivery Etail

REVENUE(1) (US$’m) SPOTLIGHT REVENUE(1) (US$’m) Using cutting-edge 292m technology to cut food- IFRS: >100% LC: >100% Delivery Hero delivery times IFRS: 24% LC: 36% orders in 2018 TRADING (LOSS)/PROFIT(1) (US$’m) iFood is using artificial intelligence TRADING LOSS(1) (US$’m) and machine learning to reduce 18 000 delivery times. Guided by the restaurants on technology, bikes with margherita IFRS: >100% LC: >100% Swiggy’s platform pizzas can be dispatched to IFRS: 4% LC: 10% Notes neighbourhoods with high demand (1) Presented on an economic-interest basis. Notes so they are closer to customers (1) LC = local currency. Presented on an economic-interest basis. before the customers have actually LC = local currency. ordered. As a result, they can We are continuing to build on our deliver the pizzas far quicker – strong presence in online food delivery. Focus on electronic retail in 10 minutes, rather than 40. eMAG grew strongly across Delivery Hero its markets Delivery Hero is a leading online This is an extensive eMAG delivered another year of strong food-delivery company globally, market filled with growth rates and high market shares in operating in more than 42 countries its key markets. and leading in 36. Delivery Hero is opportunities and we predominantly a third-party (3P) are still early in the cycle eMAG also performed well on marketplace model, where its platforms of bringing technology strategic KPIs such as 3P marketplace arrange for restaurants to deliver food share of GMV and units sold per active to users. But it also has a first-party (1P) to an important part customer. marketplace model, where it provides of people’s lives – eating the delivery services as well. Delivery UNITS SOLD PER CUSTOMER PER YEAR Hero achieved 292m orders in the 2018 at home and at work. financial year. Swiggy Swiggy is a leading online food-ordering and delivery company in India, an underpenetrated but high-potential market. Swiggy has attracted over 18 000 restaurants to its platform and has earned strong consumer trust by FY14 FY15 FY16 FY17 FY18 delivering meals in an industry-best average of 35 minutes per order. It is India’s fastest-growing food platform. 3P MARKETPLACE SALES AS % OF GMV iFood iFood, a subsidiary of Movile, is a GMV 1P leading online food-delivery platform GMV 3P in Latin America. In Brazil, iFood is the % 3 preferred destination for food delivery. FY14 97 2 FY15 98 17 Quicker delivery times mean happier FY16 customers; technology’s the key. 83 21 FY17 79 30 FY18 70 38 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Etail continued

In addition, the Romanian business reached profitability, a milestone for Attracting and eMAG. This was achieved by scale, eMAG’s fourth retaining top talent enabling eMAG to increase margins, hackathon grow purchasing frequency and Across the group we focus on attracting optimise operational efficiency. Each year eMAG holds a and retaining exceptional talent. At eMAG, hackathon – 24 hours when for example, attraction strategies include eMAG continues to focus on increasing coders unite to code something rewards, ensuring market-competitive quality of service and delivery for amazing, impress the judges and compensation, and specific talent-sourcing customers and on controlling costs. win great prizes. It’s an excellent strategies such as hackathon events, eMAG bought its own courier company way to attract the best tech talent university relations and graduate during the year and has started to a business with a strong focus recruitment, internship programmes and construction on building a 120 000m2 on IP that likes to develop its own employee referral programmes. Retention warehouse. software. strategies include ensuring there are plenty of on-the-job development opportunities Flipkart This year each team had to build a as well as specific high-potential talent- In May 2018 the group announced the project using artificial intelligence, development initiatives. sale of its interest in Flipkart Limited – virtual reality, augmented reality its equity-accounted etail investment in and internet-of-things technologies The initiatives are proving successful, with India – to US-based retailer Walmart to address themes including: eMAG being named the number one IT Inc. for US$2.2bn. The transaction is employer of choice in Romania in 2017. subject to regulatory approval. • improving customer experience in eMAG showrooms or at home Myntra also performed • improving the payment method for the showrooms, web well, improving topline or mobile growth and EBITDA. • improving the buying experience on mobile, app or web, and Myntra’s strong results • improving delivery and reflect its higher private- warehouse logistics efficiency. label sales, greater buying Sixteen teams competed and power from increased 24 hours later, winners were scale, and cost savings announced in the following from Myntra and Jabong’s categories: integration. • best hack • most innovative project • customer and user experience • project with the best code, and • most popular project.

In Romania eMAG is the number To attract the best tech talent one IT employer of choice. eMAG holds an annual hackathon. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 39

Etail continued Travel

Takealot continues to SPOTLIGHT REVENUE(1) (US$’m) SPOTLIGHT grow its business in a Recycling packaging? 2018 276 sustainable way. It is all US$ 100%! 2017 123 No1 about executing a well- (1) IFRS: >100% LC: 21% MakeMyTrip is the made plan, focusing on 2.2bn One of the things that goes hand in leading Indian online proceeds from sale hand with etail is packaging. It is an TRADING LOSS(1) (US$’m) travel agency of Flipkart inevitable requirement for the growing the business and 2018 increasing margins and on protection of the products that (61) customers buy and look forward to 2017 (88) US$ becoming more efficient receiving. Takealot has taken on the IFRS: 31% LC: 21% No1 challenge to make 100% of their throughout its distribution Takealot is the Notes 155 m (1) leading etailer delivery packaging recyclable. Not only Presented on an economic-interest basis. Our 2018 additional and supply chain. in South Africa the boxes they use, but also the LC = local currency. investment in padding material that safeguards MakeMyTrip Takealot continued to grow as the customers’ products. With this MakeMyTrip strengthened its leader in South African etail Note initiative Takealot aims to balance the leadership in India As the market leader in South African (1) Disposal is subject to needs of both customers and the Following its merger with goibibo the regulatory approval. etail, Takealot is well positioned to environment. previous year, MakeMyTrip (MMYT) continue growing its business. strengthened its leadership in the large, fast-growing Indian online travel agency During the year we increased our (OTA) market. effective stake in Takealot from 47% to 96% through two investments. MMYT continues to focus investment In August 2017 we injected US$74m on the high-growth hotels segment. It into the business to fund ongoing plans to expand this market by bringing operations. In December 2017 we more customers online and increasing bought out other shareholders at the transaction frequency of existing a cost of US$128m. customers.

Optimising our etail portfolio In May 2017 we contributed US$132m As part of our ongoing portfolio of a MMYT US$330m fundraising round, optimisation, we exited non-strategic which also included Ctrip and other etail assets Souq and Konga. In May shareholders. This additional capital 2017, Souq was sold to Amazon. In gives MMYT the resources to continue February 2018, Konga was sold to growing the online-travel market in India. Zinox Technologies, a local Nigerian retail business. We invested an additional US$23m during the year to maintain our relative shareholding. Ventures

REVENUE(1) (US$’m) 2018 223 2017 155 IFRS: 44% LC: 37%

TRADING LOSS(1) (US$’m) All of Takealot’s delivery packaging 2018 (134) is now recyclable. 2017 (107) IFRS: 25% LC: 17% Notes (1) Presented on an economic-interest basis. LC = local currency. 40 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Ventures continued Social and internet platforms

Through Naspers Ventures we partner In Poland 85% of all SPOTLIGHT REVENUE(1) (US$’m) Tencent is increasing its investment in SPOTLIGHT with local entrepreneurs to build select areas including video, payments, leading technology companies in school kids access Brainly Increasing awareness cloud, AI technologies and smart retail. high-growth markets. We identify at least once a month. >110 m and respect The group remains committed to 56% companies and founders with high Brainly students IFRS: 60% LC: 56% enhancing its development and year-on-year potential and the ambition to scale Brainly Movile runs a diversity awareness innovation capabilities. increase in Tencent’s globally. Our goal is to identify the next Brainly is a social learning platform programme called Respect, (1) revenues TRADING PROFIT (US$’m) Tencent is listed on the Hong Kong phase of growth for Naspers – serving more than 110m students in which plays an active part in the Stock Exchange and extensive further identifying trends, technologies, more than 35 countries. Brainly assists 45m company culture. The people have taken information is available on its website segments and geographies that will students with an infinite number of programme changes the way Codecademy www.tencent.com. 19 m experience significant growth in the school subjects, including maths, history, courses commemorative dates are IFRS: 35% LC: 33% *Restated mobile daily active coming decades and investing in the literature, coding and science. celebrated and encourages Notes Mail.ru strengthened its position Mail.ru users best opportunities we see there. discussions on gender equality, (1) Presented on an economic-interest basis. as Russia’s number one internet group Codecademy racism and religious tolerance LC = local currency. Mail.ru remains the largest internet We evaluate consumer trends to >20m across the company. In addition, Codecademy is a vocational learning Udemy students group in Russia by users, with 19m understand engagement at a deep level platform, with 45m people having taken Respect participants play a very Tencent continued to excel in China mobile daily active users (DAUs) across and use this information to identify courses to learn how to code. With important social role within the Tencent continues to perform well in its platforms. Its leading platforms cover investment opportunities. We are more than 56% of registered users > company, becoming a focal point a highly competitive and dynamic gaming, social networking, email, portal, currently focusing on a number of learning code to find a new job, 100 m for Movilians to seek support, environment. Through its ecosystem search, instant messaging, ecommerce, specific segments including edtech, Codecademy is helping people in every monthly Movile share stories and address of online services and the excellent users business services, and maps. It is the top healthtech and agtech. Within these country around the globe to upskill and diversity subjects. management of Pony Ma and Martin mobile app publisher in Russia in terms segments, we have made investments find better career opportunities. Lau and their teams, it remains the of both number of downloads and in innovative companies with largest platform operator in China. consumer spending. high-potential platforms, and we continue Udemy to look for more great opportunities. Udemy is a global education marketplace Movile is increasing diversity For the year ended 31 December 2017, Mail.ru’s revenue for the year to December for lifelong learners serving more than awareness through its Tencent’s revenues of RMB238bn were 2017 was up 34% to RUB57bn. Key We are targeting businesses that are 20m students in 190 countries around companywide Respect programme. up 56%. Non-GAAP profit attributable revenue drivers were online games and addressing big societal needs, such the world. It combines a business model to shareholders (Tencent’s measure of advertising. Mail.ru’s two largest games, as online food, education and health, we know well, two-sided marketplaces, normalised performance) grew 43% to Warface and War Robots, continued to where the right combination of with a sector we are excited about. RMB65bn. perform well. The online games business technology and entrepreneurialism With 20 000 instructors teaching more Revenues from value-added services continued its expansion internationally and can disrupt for the better – driving than 65 000 courses, you can literally (VAS) increased 43% year on year to across new platforms. International down costs and driving up quality learn anything on Udemy. RMB154bn, with online games revenues revenue accounted for over half of Mail.ru’s for consumers. growing 38% to RMB98bn and social online games revenues. Mail.ru continued Movile networks revenue rising 52% to to see good growth in advertising revenue, Providing ongoing global support Movile is the top mobile commerce RMB56bn. Online advertising revenues especially on mobile, benefiting from shifts We provide ongoing global support to platform in Latin America, with over rose 50% to RMB40bn. Other revenues in advertising budgets towards online and all our Naspers Ventures companies. 100m users per month. Movile develops (mainly payments and cloud services increased advertiser spending towards The support ranges from human world-class mobile marketplaces and is a revenue) rose 153% to RMB43bn. social networks. resources, product and growth leader in B2C mobile app-based services VKontakte, the most popular mobile strategy, finance and M&A expertise, in Latin America, including iFood and Tencent’s Weixin platform strengthened messaging and social networking app in research, general counsel, to IP and Sympla. A leading self-service ticketing its ‘super-app’ status, with monthly active Russia, continued to perform well. Over communications. In addition, Ventures platform in Brazil, Sympla is a one-stop users exceeding the 1bn mark in February the year, the number of newsfeed views companies have the ability to tap into shop for entertainment and events in 2018. The group maintained its leading increased 30%, and every day more the resources of our global network Latin America. Movile is also ramping up position in the Chinese online games than 9bn post views are generated. of entrepreneurs and businesses its content distribution. It is one of the market and continued to grow its global across the group in 120 countries and largest distributors of digital kids’ content presence. Mail.ru continued to invest in new markets. It’s part of our long-term in the world. strategic areas such as esports and approach to increasing value in the Tencent’s strong presence in social media and utility products drove healthy online food delivery in Russia. In January businesses we back, on the way to SimilarWeb 2018, Mail.ru announced the acquisition building leading technology companies. SimilarWeb provides digital market growth in advertising revenues from its various platforms. The group extended of 100% of ESforce Holding, one of the intelligence for online businesses. It largest esports companies globally. Investing in edtech measures and analyses millions of mobile its leadership in mobile payments in We are backing a number of ventures apps and billions of webpages, providing terms of active user accounts and further Mail.ru’s depository receipts are listed to transform the way people learn insight into traffic flows and consumer expanded its presence in commercial on the London Stock Exchange. Further around the world. behaviour to help companies make more transactions, with offline transaction information is available on its website informed management decisions. volume more than doubling year on year. corp.mail.ru. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 41 Video Entertainment We are building Africa’s leading video-entertainment business. The key to our growth and success is to offer our customers great entertainment anywhere, anytime across platforms including digital terrestrial television, direct-to-home and subscription video-on-demand services.

Highlights of the year

SUBSCRIBERS INCREASED BY TRADING PROFIT GREW WE NOW HAVE OVER

1. 5 m 29% 13 m year on year 24%(1) to US$369m subscribers across Africa Note (1) In local currency excluding M&A. Total subscribers We continued to We invested We continued to increased by implement our heavily in local drive costs down. 1.5m to over value strategy. content. 13m households.

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Markets Performance Focus on Launch of a dedicated satellite We are facing increased competition REVENUE(1) (US$’m) from global and local players across South Africa Giving our customers our video-entertainment markets. Increasing subscribers Competition is increasing with video uninterrupted viewing is not Despite a tough economic and negotiable. MultiChoice’s journey consumption on online platforms IFRS: 8% LC: 7% uncertain political environment, we growing, and global players like Netflix, as a premier satellite broadcaster achieved subscriber growth of more took a huge leap forward with Amazon, Facebook and iFlix continuing (1) TRADING PROFIT (US$’m) than 500 000 and are now approaching Intelsat’s launch of the IS36 to offer alternatives to our service in 7m total subscribers. our territories. In addition, local satellite. The satellite launched from the European Space streaming players like Kwese, Cell C Increasing profitability Black and Vodacom VideoPlay have also Agency’s Guiana Space Centre IFRS: 29% LC: 24% The trend of growth in the mass market emerged. in French Guiana on 24 August continues, while our Premium tier is Notes 2016. The satellite has an (1) showing declining growth and the Aspiring direct-to-home (DTH) and Presented on an economic-interest basis. intended lifespan of 15 years, Compact tier is starting to stabilise. digital terrestrial television (DTT) LC = local currency. thereby providing adequately Due to this change in our customer players continue to invest across Africa, for MultiChoice’s DStv roadmap mix, average revenue per user (ARPU) notably StarTimes, Zap, Azam and A solid performance until at least 2031. declined from R353 to R344 year Kwese. Free-to-air channels and Our video-entertainment segment on year. analogue switch-offs in many countries once again produced a solid performance, with subscribers are also creating further competitive Enhancing products pressure on our products. increasing by 1.5m and profitability growing 29% year on year. We now We continue to enhance our product have over 13m subscribers across offering to deliver the best customer the continent. This reflects the success experience. of the value strategy we have been implementing for the past two years This year we repositioned the Extra where we have reorganised our Bouquet as Compact Plus, to define channel bouquets to attract more more accurately the product subscribers as well as focusing on proposition and align with the naming improving our systems and, in turn, convention in the rest of Africa. We our customer retention. offered Showmax free to Premium subscribers and discounted Showmax to R49 for Compact subscribers, resulting in excellent uptake. The DStv Now channel line-up was increased to match our satellite offering and We performed well in the high-definition SuperSport channels increasingly competitive world were also added. of video entertainment.

Our dedicated satellite in space helps ensure uninterrupted viewing back here on earth. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 43

Focus on South Africa continued

Our online properties are gaining This year we also increased our offering SPOTLIGHT traction. To increase access to DStv of themed pop-up channels, which Keeping data secure Now, we have opened it to all bouquet proved very popular with viewers. Wide-ranging corporate tiers. Explora penetration, BoxOffice social investment Irdeto has developed several solutions rentals and connected Explora Managing regulations c7m around encryption and key management. the number of connections also recorded good and reputation video-entertainment Social and relationship capital its kind – the Let’s Play Schools growth during the year. Our teams continue to engage and subscribers in Across our video-entertainment Physical Education Challenge – to Encryption allows information and data to work with our regulators to shape our South Africa segment we continue to contribute celebrate reaching its 10-year be hidden so that it cannot be read without We have also created a connected video regulatory environment and limit towards various corporate social milestone in 2016. The primary special knowledge, or a ‘key’. To read the division by combining our Showmax adverse operating conditions. They also responsibility (CSR) programmes – objective of this challenge is to encrypted information a specific (secret) key Africa and digital media operations help to manage our reputational risk to is needed to decrypt the information. There from the Magic in Motion Academy reinforce the instruction of to ensure we give adequate focus to protect our brand. R344 are already many ways and standards to average revenue to SuperSport’s Let’s Play initiative. curriculum-oriented physical encrypt content and data, so that is not the online products moving into the future. per user It’s all part of our commitment to education and promote physical challenge. However, what is extremely Showmax International continues to build Concerns about MultiChoice South enriching lives across the continent. activity in all schools. Let’s Play assists difficult is dealing with the complexity of and grow our business in Eastern Europe. Africa’s relationship with ANN7 and the Department of Basic Education issuing keys during the manufacturing questions about how it lobbied Total corporate social investment with its school infrastructure project, process of devices, to distribute keys, to Serving our customers with government were raised in the media spend totalled R60m in 2018. together with partners Hitachi encrypt keys (with using other keys) and top-quality content in November 2017. As a result, the Construction Machinery and then to manage and revoke and redistribute We successfully renewed key MultiChoice audit and risk committees Project Thorn Builders. Eight multi-purpose artificial new keys, eg when there is a hack. entertainment and sport rights, came together to assess: whether or not This programme helps stop crime, fields have been built at selected including the English Premier League appropriate procedures were followed specifically human trafficking, with primary schools to date with another Irdeto takes care of that challenge (EPL), Premier Soccer League (PSL) in in relation to the ANN7 contract; the the use of Irdeto technology. three to be built at beneficiary by implementing and managing mostly South Africa, UEFA Champions League payments that were made by MultiChoice schools in 2018. two-way systems where both ends send (UCL), as well as the Discovery, Disney to ANN7; and whether or not there MultiChoice Diski Challenge and receive data. and Turner offerings. In addition, we were irregularities in the submissions Amounting to R45m per annum, M-Net Magic in Motion (MiM) secured key once-off properties such MultiChoice made to the Minister of including rights, this multifaceted Film and TV Academy and Irdeto is an industry leader in developing as the Conor McGregor vs Floyd Communications. After a thorough and programme is aimed at developing Career Expo security building blocks to create secure Mayweather fight, which drew record comprehensive review the committees football and broadcasting. Through MiM, CSI projects include key-based business systems such as Key viewership across platforms in the year. found no evidence of corruption or an extensive internship programme, Generation Technology to embed the These successes allow us to continue to other illegal activity but did identify Let’s Play where young producers work master key in devices and servers; key serve our customers with top-quality certain procedural shortcomings. SuperSport’s flagship social with industry experts for handson distribution systems to ensure keys are international content. MultiChoice South Africa accepted investment initiative, the programme experience. The MiM Career Expo only provided to legitimate business users; the findings and confirmed that it will is an implementation partner of was launched in August 2014. M-Net software protection technology; hardware Our investment in local content is primarily address the shortcomings that were school sport for the Department of partnered with tertiary and financial protection elements; secure telemetry through the Mzansi group of channels in identified. Accordingly, MultiChoice Basic Education and is now active in institutions, as well as production to identify potential breaches and many South Africa and Africa Magic in the rest South Africa will ensure that robust thousands of schools nationwide, companies, to give learners a more. At the same time Irdeto supplies of Africa. Our efforts have been well due diligence processes will always reaching over a million children complete view of the industry. end-to-end security systems like Cloaked CA, received by subscribers, with our channels be followed for startup channels and annually. Attendees were also made aware which is the world’s leading software-based among the top performers in their peer that management highlights issues of of the variety of jobs available in the conditional access system; Control, which group. We also launched a new channel, controversy and reputational risk at The Let’s Play Schools Physical industry, such as presenting, acting, is the most universal and powerful DRM 1Magic, to cater for the Premium local the quarterly audit and risk committee Education Challenge camerawork and directing, giving licence system as well as KeyStone, which audience, anchored by a high-quality meetings. Key issues will be brought In partnership with the Department them valuable insights from industry is an innovative connected vehicle access local telenovela – The River. to the MultiChoice South Africa board of Basic Education, Sport and experts and practical exposure to and usage management system. for further consideration, including how Recreation South Africa, the Physical several disciplines. We are investing heavily to formalise MultiChoice South Africa’s Education Institute of South Africa lobbying process. In the absence of and Unicef SA, SuperSport launched in local content – it is an national guidelines on lobbying and the biggest school sport initiative of important differentiator interaction with regulators and government, MultiChoice management for us that our customers will develop guidelines for approval by really appreciate. the board. MultiChoice South Africa In 2018 our video-entertainment Irdeto is an industry leader in keeping confirmed that it would not renew segment invested R60m across information and data secure. ANN7’s current contract when it ends various CSR initiatives. in August 2018. It confirmed there will be an open bid for a replacement local news channel. 44 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

SPOTLIGHT Focus on the Creating an Developing leadership >13m outstanding green and gender diversity rest of Africa the number of building for MultiChoice video-entertainment Across the video-entertainment This includes ensuring that all of Across the rest of Africa we continued subscribers across segment, we have a number our human resources policies, our value strategy – focusing on MultiChoice City, based in South Africa Africa and home to our of established programmes processes and practices support accelerated subscriber growth across to develop leadership abilities diversity and inclusion. all bouquets while controlling costs. video-entertainment segment, is 5-star Green Star-rated, a rating and competencies at all levels of seniority. Managing talent Improving products received from the Green Building Council of South Africa. The Our talent management We further improved our product Empowering women framework helps in the offering with the successful launch of building offers a grey water reticulation system and heating and We implemented a Leading implementation of succession Compact Plus in Namibia, Angola and Women programme with the planning and the employment Mozambique and the launch of GOtv cooling systems and processes to trap and disperse natural light. Gordon Institute of Business to of women in senior roles. Max, a new higher-tier bouquet on develop women at a middle to our DTT platform. This 5-star rating was achieved senior management level. We also have affiliations with by following the Green Building LGB Tech and Women in Tech Reducing costs Other initiatives include internal as part of our commitment to We removed substantial costs from the Council’s matrix, with key points scored for: leadership development promoting recruitment diversity. business by renegotiating international programmes, Women in content agreements or dropping • Management – building tuning, Management, Business and Public non-performing content and reducing Service (Wimbiz) and a women local football rights. We made further environmental management and waste management. empowerment programme with investments in new content formats and the Lagos Business School. local productions. We have also focused • Indoor environment quality – ventilation rates, air-change on reducing overhead costs, despite We have submitted a five-year inflationary pressures. effectiveness and volatile organic compounds. employment equity plan to the Department of Labour as part Improving our customer journey • Energy – greenhouse gas emissions, energy sub-metering, of our compliance to the We continued to improve on key Employment Equity Act. capabilities such as sales and lighting power density, lighting distribution, retention and customer zoning and peak energy-demand care, which are all geared towards reduction. improving our customer journey. We • Water – occupant amenity also continued to strengthen and build water, water meters, landscape teams in growth areas of the business. irrigation and heat-rejection water. Irdeto • Materials – use of Irdeto had another strong year with environmentally friendly material. positive growth in revenues and profitability. To reinforce its product Points were also scored for portfolio, Irdeto completed the transport, land use and ecology, acquisition of Denuvo, the number one emissions and innovations. supplier of anti-tamper and anti-cheat solutions to the video-gaming industry.

Our video-entertainment segment MultiChoice’s head office has has a number of leadership and a 5-star Green Star rating. gender diversity programmes. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 45 Media In our media segment, Media24 is building communities through content, technology and commerce. We are focusing on building a more diversified media player with market-leading mobile content and a portfolio of ecommerce solutions, including efashion, efulfilment and online job classifieds. This will enable Media24 to capitalise fully on rising mobile internet connectivity across the continent as well as on South Africa’s growing online retail sector.

Highlights of the year

MEDIA24 (EXCLUDING NOVUS) REVENUE WAS FLAT YEAR ON YEAR AT US$

Media24 (excluding Online fashion store 24.com achieved The larger portion 374m Novus) revenue was Spree achieved double-digit year-on- of Media24’s flat at US$374m. topline growth year revenue growth. investment in Novus of 49%. was unbundled.

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Markets Investing in social and We are navigating a competitive Media24 relationship capital and fast-changing market Growing ecommerce and news Media markets remain highly Online fashion store Spree Media24 aligns its strategic Working with governments competitive and fast changing. Revenues outperformed revenue expectations corporate social investment (CSI) Media24 is working on two in traditional media streams are under with topline growth of 49%. with core business interests to strategic agreements with pressure whereas digital and technology Nearly 50% of sales came from enhance stakeholder relations governments. A partnership changes create great opportunities mobile devices. and build its profile as a good with the Gauteng provincial for players with the resources and drive corporate citizen. government will provide to adapt. Spree also launched visual search training opportunities in functionality and won the African Training tomorrow’s journalists digital, communication customer experience award for Through its flagship CSI and entrepreneurship to innovation. programme, WeCan24, Media24 unemployed youth via the Performance equips young people with digital Tshepo One Million programme. 24.com achieved double-digit journalism skills. Young people A partnership with the Western REVENUE(1) (US$’m) year-on-year revenue growth and learn how to use digital Cape government’s Premier’s technologies to research and Advancement of Youth (PAY) increased daily average unique browsers by 6% year on year and produce news and information. programme has enabled pageviews by 9% during the period. During the year, nearly 2 000 Media24 to include internships IFRS: 14% LC: 1% young people were trained at 350 for youth with its enterprise The News24 app’s engagement schools and more than 2 000 development partner, TRADING PROFIT(1) (US$’m) reached all-time highs in the financial articles were published on the Mikateko Media. WeCan24 platform. Going year. forward, the WeCan24 platform and programme will have a IFRS: 84% LC: >100% stronger digital focus. Face-to-face training is being converted into Notes a Massive Open Online Course (1) Presented on an economic-interest basis. LC = local currency. (MOOC) that will enable young people everywhere to access the material at any time. They will be able to learn writing and research skills via an accredited digital journalism course. The plan is for the programme to be self-sustaining by becoming a As the competition and training conduit for partners who speed of change in media pay to use the platform. markets continue to rise, we are adapting our businesses for success.

Media24 is helping to train the next generation of digital journalists. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 47

Performance continued

Netwerk24 Preparing for a potential water crisis 6 months. On the Dot 32 engineers. In South Africa we have a tradition South Africa has recently 30 stakeholders. of volunteering ‘67 minutes for declared a national disaster due 113 standups. Madiba’ on Mandela Day, to severe drought conditions in 689 tasks logged. honouring the life and work of the several provinces. The Western 7 232 cups of coffee. late President Nelson Mandela. Cape province is a particular Rika Swart, general manager of concern as it is experiencing its This is what it took to integrate On the Dot, Media24’s distribution worst drought on record. The Media24’s digital lifestyle properties business, challenged her team to City of Cape Town disaster into Netwerk24, the subscriber- do 67 good deeds for Madiba by management plan called for Day based home of Afrikaans content. the end of July. Despite working to Zero to be implemented when Designing one home that would tight schedules and deadlines, with dam levels reach 13.5%. On Day feel right for each of the brands, the constant pressure to do more Zero the water reticulation and which their audiences would with less, the team embraced the system to most areas in the city want to pay for, was no mean feat. challenge bravely, pulling on their will be turned off and residents The small team ran six key projects overalls to repaint schools, feed the will need to collect their quota in six months – app content hungry through soup kitchens, care of 25 litres per person per day integration, site designs and for the elderly and many other at 200 distribution points across rebuilding, print content, paywall initiatives. By the end of July, the the city. enhancement, emagazines, and team had volunteered for 72 rebranding. Through innovation, separate initiatives. They made a At Media24 and other Naspers creativity and exceptional difference, and inspired themselves businesses in Cape Town, we collaboration, the team achieved and the rest of Media24. But the have been preparing for a what had seemed like an story doesn’t end there. Their potential water crisis identified by impossible task. Subscriber heart and courage carried the the government by implementing numbers are up significantly and team through tough times a few water-saving and resilience the team is applying the lessons months later: they went through initiatives, running awareness they learnt along the way to their a restructuring process that campaigns, and developing plans next project. affected the whole middle to work differently in the event management team. And yet, their of Day Zero. engagement scores have never been higher.

Our South African businesses are well prepared for a severe water crisis.

Media24’s distribution business On The Dot performed a variety of good deeds on Mandela Day – 72 in all. 48 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Performance continued

The migration of our Afrikaans lifestyle titles to Netwerk24 on 1 November Optimising distribution Data-driven engineering 2017 showed promising early results, with a solid increase in subscribers. across the business At Media24 we employ only the best Netwerk24 is the largest digital – and we seek out talent that will raise subscription news destination in Any media company knows machine the bar and challenge us. Some of the South Africa. learning (ML) and artificial intelligence new appointees to our 24.com (AI) are integral to its tech and product engineering team include an actual Posting positive results in print media suite. Media24 embraced this by rocket scientist, and a PhD biochemistry Our print media, book publishing and launching apps based on ML and AI in graduate – not traditional skills in the distribution portfolio posted excellent FY18. Our aggregator and personalised media business, but critical to our results. Better than expected app suite now include News24 Edge, data-driven approach. advertising revenue, the phenomenal a personalised version of flagship online success of The President’s Keepers title News24, as well as soccer (Jacques Pauw’s best-selling exposé aggregator Daily Kick, general news on President Jacob Zuma, published aggregator Sliced and Nigerian news by NB Publishers), good textbook aggregator Bounce. Spree, our efashion orders and strict cost management business, also piloted an AI-powered all contributed. visual image search functionality on its app whereby shoppers can upload Playing our part in investigative pictures of clothing they like and then journalism view similar items for sale on Spree. Investigative journalism in South Africa It was the first of its kind for efashion is flourishing, exemplified by the success in Africa. News24 Edge was named of The President’s Keepers. The the top mobile news service by the #Guptaleaks team, included 24.com World Publishing Expo and the World investigative journalists Pieter-Louis Association of Newspapers and News Myburgh and Angelique Serrao, won Publishers, while Spree won the the Vodacom Journalist of the Year prestigious African Customer award for their series of revelations on Experience Innovator Award for state capture. At the Standard Bank its image search functionality. Sikuvile awards, Suzanne Venter won the investigative journalism award and SA story of the year for her work on the Life Esidimeni story. Media24 seeks best talent – raising the bar and challenging us. We are immensely proud of our awarding-winning investigative journalists Unbundling Novus Holdings Effective 26 September 2017, the majority of Media24’s investment in Novus Holdings Limited was unbundled via Naspers, in accordance with the Competition Tribunal’s merger approval condition. Post unbundling, Media24 retained a 19% investment in Novus (down from a pre-unbundling shareholding of 66.5%). Since 30 September 2017, the investment in Media24 embraced ML and Novus is carried as an available-for-sale AI launching News24 Edge. investment and its results are no longer consolidated on a line-by-line basis. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 49 Our people

At heart, we are entrepreneurs. HEADCOUNT BY REGION Each year we organise internal We focus on attracting the world’s networking and learning events to bring best talent to build leading companies together teams and communities of MyAcademy that empower people and enrich expertise, often from across the group, communities through outstanding to share ideas and learn from internal We launched our online and products used by millions of people and external experts. offline learning environment, every day. MyAcademy, in September 2016 We perform and this year more than 20 000 Talent, particularly in the fields We push for performance in everything people accessed content of ecommerce, technology and we do, and we link achievements and on MyAcademy online. engineering, is scarce globally. As such, rewards. We agree on clear and MyAcademy online offers the being seen as an attractive and ambitious goals, have continuous very best online learning content meaningful place to work is key to conversations about achieving even from global providers such as our strategy. more and reward our people for what Udemy, Big Think, Harvard Business School, Codecademy, % they deliver and how they deliver it. We encourage innovation from all our Ready, Vado, and Rosetta Stone. EUROPE, MIDDLE EAST AND AFRICA PERMANENT EMPLOYEES 76 people. To attract and retain the skills Our MyAcademy classroom- ASIA-PACIFIC 6 on which our sustainability depends, based programmes offer our AMERICA 8 and to reward superior performance, people the opportunity to grow LATAM 10 most of our group companies grant their leadership skills regardless 24 887 share options/share appreciation rights of where they are in the world. *Excludes associates and joint ventures. to their employees under a number of We also focus on developing key long-term incentive plans. functional skills in the areas of technology, sales and business During the year we brought fresh HEADCOUNT BY BUSINESS SEGMENT We matter development, finance, law and talent into the group at all levels and We matter to the communities we human resources. This year more strengthened our focus on people serve and, wherever we operate, we than 1 500 people attended such across the organisation, providing new hold ourselves to high standards. Our programmes. opportunities to existing employees. code of business ethics and conduct The group employs 24 887 (2017: defines our commitment to conducting During the year ended March 25 000) permanent employees in business fairly, ethically and with 2018 active learners from around some 120 countries and markets. integrity. This code and related policies the group had consumed more 26 000 are communicated to group employees than online lectures and We empower 43 000 and are available on www.naspers.com. engaged in more than We back local teams and learn from hours of training on this platform. each other. We encourage diversity in Many of our companies invest in our teams and in our thinking. Our corporate social responsibility people are empowered to be programmes and we encourage our responsible and make decisions because % people to support these by investing their we trust them to do a great job. We B2C 15 time. Wherever we operate we employ believe in them and we want them to local people and we create supportive, share their talent and expertise across CLASSIFIEDS 18 CORPORATE flexible and pleasant environments to the group. Through MyAcademy (the 2 help them perform at their best while offline and online learning environment NASPERS VENTURES 13 developing their skills. We focus on the for the group) and local learning and PAYMENTS 4 ongoing development of our managers, as development initiatives, we invest in our PRINT AND DIGITAL MEDIA 19 creating an environment where our people so they can build their skills, their people feel cared for, heard and expertise and ultimately, their careers. VIDEO ENTERTAINMENT 29 Through MyAcademy, supported in their ambitions, is ultimately our people can tap into *Excludes associates and joint ventures. in their hands. Together we are all online learning. responsible for the positive impact we have on our stakeholders. 50 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Our people continued

People development Naspers contributes to workplace Naspers Information and Communication Technology (ICT) Code scorecard “Our ever-changing environment Developing our talent is a critical Quotes from employees using our transformation and diversity through: learning platforms: requires everyone to be able to Actual enabler of present and future success, pick up new abilities effectively. Bonus Bonus score as well as playing a role in the • Gender equality and leadership Target points points achieved “MyAcademy has been really very Over the course of my time using development initiatives. This is a motivation and retention of our people. MyAcademy, I’ve been able to Element score available achieved 2018 Most of our businesses around the helpful for understanding founding principle of all development marketing and writing skills in take a look at resources that are initiatives, especially in areas where world have a learning and development needed for my day-to-day Equity ownership 25 0 0 19.85 agenda focused on their own specific depth. The learning platform has a there is an imbalance (eg women in huge range of customised courses activities, ranging from software technology). Learning programmes needs. This is influenced by factors engineering to leadership and Management control 13 0 0 6.98 such as what the business is aiming to which intend to impart quality include specific modules to learning. Be it barging on compliance. Every time I desire to communicate effectively across culture, achieve, the maturity level of the learn something new using a Employment equity 10 0 0 4.83 business, the opportunities and traditional yet evergreen content gender and age, both locally and when practices or latest google analytics structured approach, MyAcademy representing the group abroad. challenges it is tackling, its competitive is the first place I look for Skills development 20 5 2.59 18.01 landscape, and the demographic trends, MyAcademy has supported • A global talent function, with my industrial growth 15 times. The information.” experienced recruiters in key regions nuances of the region or countries Santiago Vargas Baldrich, Preferential procurement 25 2 2 21.10 where it operates. At group level we profound teaching of the and the ability to design competitive instructors on the platform is very technical leader – machine base our people development focus reward packages. Enterprise and supplier useful and easy to grasp learning, LatAm. 25 3 3 28 on four key areas: • Attracting and retaining the skills on development everything. Glad to be a which our sustainability depends. We MyAcademy student!” Occupational health and safety • Reinforcing the leadership pipeline pay for performance and to reward Socio-economic development 12 0 0 12 and accelerating the growth of top Kinjal Shah – content marketing The health, safety and wellness of our superior performance, most of our – PayU India. talent. people are critical, given that our group companies offer performance- Total score 130 10 7.67 110.73 • Driving a performance culture. growth depends on their skills. For related incentives, including long-term “MyAcademy has increased my Naspers, employee wellness is key to • Supporting the ongoing development incentives such as share options/share Performance (%) 76.67% and growth of our businesses and appreciation of my work. I have a organisational sustainability. Accordingly, appreciation rights to their employees. equipping our people with new skills firm grip of areas like database, we care for our employees through • Developing our talent. This underpins for tomorrow. team building, leadership, customer multiple initiatives, understanding that our success by motivating and service and finance. I now stay a healthy and resilient workforce is • Developing core business skills in retaining skilled people. Most of our BBBEE rating Level 3 ecommerce, video entertainment abreast of trends in my discipline. essential to support the changes our businesses around the world have a What’s most exciting is that I can business is navigating. Health and safety and media. learning and development agenda Priority elements achieved Ye s access any course with just one is one of the standard risks considered focused on their specific needs and We believe happy and engaged click without paying a dime. I now and assessed in our risk management markets. Training expenditure for the have confidence to face the future employees create fantastic customer framework. Businesses are required to reporting period totalled US$17m. Independent BBBEE verifications were performed for the above period. experiences and in a competitive global and I look forward to completing report on any health and safety-related talent market, it’s important that we many more. I will forever remain incidents. Any reported matter gets Naspers respects the dignity and indebted to MultiChoice.” For further details on MultiChoice’s and Media24’s BBBEE scorecards, refer to the provide our people with a compelling reviewed by the group’s governance human rights of individuals and corporate websites, www.multichoice.co.za and www.media24.com, respectively. place to work. We measure employee Vincent Ekow Quansah, training committee that meets quarterly. In communities wherever it operates. engagement across the group and administrator MultiChoice Ghana. 2018 no reports of serious injuries We aim to make a positive and we ask our people to comment sustained by employees while on duty enduring contribution to the social and anonymously on their experience “Dear MyAcademy, Thanks for were reported. economic development of South Africa, of working at our various group making me a part of this and recognise the role we can play by companies. We have seen engagement programme. This is definitely going Transformation and diversity leveraging our resources and the levels broadly in line with external to help me in achieving my career We back local teams and learn from goodwill of our employees. Naspers has benchmarks and our operating teams goals. I have already implemented each other. We encourage diversity maintained a level 3 BBBEE status and are working on addressing issues raised some learnings, as mentioned in our teams and in our thinking. remains committed to managing our and sharing best practice with one below, in my day-to-day life and Our people are empowered to be transformation efforts in South Africa. another. this is helping me handling the responsible and make decisions because situations in a very effective way.” we trust them to do a great job. We Employment equity Hitesh Chawla, area sales believe in them and we want them to For a breakdown of the MultiChoice and manager, OLX India on leadership share their talent and expertise across Media24 groups’ annual employment fundamentals programme. the group. equity statistics, refer to the corporate website, www.multichoice.co.za and www.media24.com, respectively. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 51 Financial review

Financial summary Group revenue, measured on an US$3.0bn to core headline earnings, Net interest expense on borrowings to the dividend tax rate of 20%, yielding economic-interest basis, was US$20.1bn, an increase of 45%. was US$122m, down 14%, due to a net dividend of 520 cents per listed 2018 2017 2016 up 38% on last year (or 39% in local lower use of credit facilities and the N ordinary share and 104 cents per US$’m US$’m US$’m currency and adjusted for acquisitions Several notable transactions were lower 4.85% coupon achieved on the unlisted A ordinary share to those

(1) and disposals). Ecommerce and Tencent concluded during the year. We US$1.0bn bond issued in July 2017. shareholders not exempt from paying Revenue 20 097 14 562 12 224 were key drivers of this growth. On the distributed the majority of our interest Following the disposal of Tencent dividend tax. Dividend tax will be

(1),(2) same basis, group trading profit rose in Novus in September 2017, shares, Naspers had net cash of 130 cents per listed N ordinary share Trading profit 3 403 2 322 2 150 47% to US$3.4bn (or 52% in local recognising a loss on disposal of US$8.2bn at 31 March 2018. and 26 cents per unlisted A ordinary currency and adjusted for acquisitions US$145m. Following the Tencent share share. The issued ordinary share capital Dividend per N ordinary share (SA cents) 650 580 520 and disposals) as ecommerce – particularly sale (as discussed earlier), we recorded We changed our accounting policy on as at 22 June 2018 was 438 656 059 (2018 reflects dividend proposed) the classifieds, payments and travel a gain on disposal of US$9.1bn. The put option liabilities during the year. N ordinary shares and 907 128

(1) businesses – improved profitability. participation exemption in South Africa, An aggregate remeasurement loss A ordinary shares. The company’s Development spend 956 1 084 961 Tencent’s strong performance contributed which prevents double taxation, applied of US$252m was recognised in the income tax reference number is to the trading profit acceleration. to the sale itself, but any future income statement on these liabilities 9550138714. Notes (1) Reported on an economic-interest basis. distributions to shareholders and during the year and, at 31 March 2018, (2) Prior periods restated for the group’s change in calculation of core headline earnings and trading profit Consolidated revenue (excluding accretion in value from investment will total put option liabilities were regarding Tencent’s digital content amortisation. equity-accounted investments) was up be taxed in the hands of shareholders US$2.4bn. OUR SHARE OF THE RESULTS OF 9% (15%) to US$6.7bn as ecommerce at rates of 20% or sometimes more, EQUITY-ACCOUNTED INVESTMENTS continued to scale. Ecommerce as applicable. Consolidated free cash outflow was (ASSOCIATES AND JOINT VENTURES) revenues grew 15% or 32% in local US$242m with working capital WAS currency and adjusted for the impact Naspers and its South African movements, particularly the video- of acquisitions and disposals (including subsidiaries paid and collected a total entertainment business’s prepaid Allegro and Netretail). Group of US$769m on behalf of the tax content rights renewals, having a consolidated trading loss was US$41m authorities for the 2018 year, making us significant impact. These effects were US$3.3bn – a marked improvement on last year. one of the largest taxpayers in South partly offset by dividend income of Africa. We also contribute significantly US$247m from Tencent and improved Summarised consolidated annual Development spend – reflecting the to employment and tax revenues in profitability in the video-entertainment financial statements trading losses of businesses yet to reach several countries. and ecommerce units. The summarised consolidated annual scale – continued the downward trend Dividend number 89 (all figures in financial statements appear on pages reported in September 2017. 92 to 109. The complete consolidated Consolidated development spend was CONSOLIDATED ECOMMERCE South African cents) REVENUES GREW annual financial statements for the year down 17%, when measured in local The board recommends that the annual ended 31 March 2018 are available on currency and excluding acquisitions and gross dividend be increased by 12% to our website, www.naspers.com. disposals, as the ecommerce business (1) 650 cents (previously 580 cents) per improved their profitability and scaled. listed N ordinary share, and 130 cents Development spend decreased across (previously 116 cents) per unlisted A several units, including Showmax and ordinary share. If confirmed by letgo, partially offset by additional shareholders at the annual general investment to further expand Movile’s % meeting on Friday 24 August 2018, iFood business. When the US$271m 32 dividends will be payable to invested in consolidated newer initiatives shareholders recorded in the books on (including letgo and Showmax) is CONSOLIDATED DEVELOPMENT Friday 14 September 2018 and paid on excluded, development spend on older SPEND DOWN Monday 17 September 2018. The last investments decreased 8%. date to trade cum dividend will be on Tuesday 11 September 2018 (shares Our share of the results of equity- (1) trade ex dividend from Wednesday accounted investments (associates and 12 September 2018). Share certificates joint ventures) was US$3.3bn – up 79%. may not be dematerialised or This includes once-off gains of rematerialised between Wednesday US$692m and impairment losses of % 12 September 2018 and Friday US$159m recognised by these 17 14 September 2018, both dates companies. Equity-accounted Note inclusive. The dividend will be declared investments contributed a combined (1) In local currency excluding M&A. from income reserves. It will be subject 52 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information Managing risks and opportunities

Analysing and responding The Naspers board approves the mitigate the inherent risks related to (concrete net capital creation over time). At heart, we are entrepreneurs. Within the to different risks risk committee charter, and risk these spheres. All board committees We address both in developing our parameters set by the board, we continuously Our businesses are expected to apply management policy. For management at assist the board in governing risks across strategies. In building potential and a structured approach to identifying, group and subsidiary level, our policies the various capitals. delivering performance, we transform pursue growth, and set ourselves ambitious assessing, analysing and responding to provide direction, scope and ambit to various capitals, and our strategic and risk and opportunities within tolerance apply practices and principles to manage Creating sustainable value operational decisions therefore aim to goals that create sustainable value for our levels set by the board. risk and opportunity, both operationally We consider the broad definition of value maximise production (our output per and strategically. The risk committee as financial, social and environmental capital) while minimising our use of each stakeholders. We actively seek opportunities Our risk analysis focuses on the impact assists the board to ensure that risk is sustainability – reflected in the capital (input) for optimal value creation. to improve and strive to preserve the value of risk on our objectives without losing governed in a way that supports the six-capitals model. As we execute our sight of any opportunities that may group in setting and achieving its strategies, we continuously transform Balancing our inputs and outputs results created within our existing businesses. arise. Consideration is given to our key strategic objectives. these interdependent capitals, with the in the outcomes that are the essence of risks in relation to their impact on value we create (or destroy) being value creation and the foundation of effectively and efficiently transforming All our group policies aim to govern evident as a positive or negative impact our goal-driven, dynamic opportunity capitals (ie the six-capital transformation the elements of the six-capitals across the capitals. and risk framework. The world around us evolves at a risk: in most cases operational model) to ensure value for all transformation model in a broad sense whirlwind pace. We understand that management, assisted by the finance stakeholders. and we acknowledge that by nature we We believe value is determined by our our success depends on how well we function and, where considered useful transform, impact or influence more potential to perform in future (our ability navigate the uncertainties and risks in our businesses, specialised risk For risks we are not prepared to than one capital and manage our risks to have a net positive impact on our we face and seize the opportunities management and risk support functions. tolerate, we take action to reduce accordingly. Our charters and policies capitals) and by performance itself we encounter. our vulnerability. Depending on the Group internal audit and risk support importance of the risk in relation to While standards and frameworks are assesses the effectiveness of the system tolerance levels, active management of helpful, no risk management system or of risk management and internal control the risk takes various forms and varies combined assurance model is able to and may provide assistance and in extent. We operate or implement give us absolute certainty that we fully guidance to the business. enhanced control and monitoring Governance measures that either prevent or detect understand – and will be effective in Read more on page 58 managing – all risks posed in meeting The board’s role the materialisation of a risk at the our objectives. We have experienced The board is kept updated on key risks earliest stage. We take measures that failures in the past and will likely do so in and any developments and ensures that mitigate any material consequences and on a portfolio basis, we spread the future, given the residual risk we adequate levels of assurance are The company uncorrelated risks. Board Benefits and tolerate in pursuit of growth. provided on the residual level of insurance secretary significant risks versus their set How we manage and govern risk tolerance levels. This is done through Where we can, we explore ways to We promote a culture in which robust a combination of internal sources and share or transfer risk. We run adequate risk and opportunity management independent assurance providers, insurance programmes to mitigate the processes are seen as a means to create including internal audit and risk support risk of sudden losses caused by the competitive advantage. They are and external auditors. materialisation of insurable risk. therefore integrated into our everyday Wherever we find a risk outside decisionmaking and good governance The board is assisted by various acceptable levels, we consider ways to Committees practices. committees who are tasked with avoid the risk altogether, for example by Read more in the full governance report oversight and decisionmaking for entering into an exit strategy. Responsibility our group. Management and the board are Drawing on best practice Our risk management framework, Human accountable for the choices and An internal governance committee Audit Risk resources and Nomination Social and Executive system and processes draw on ethics committee decisions we make, how we execute assists the board committees and committee committee remuneration committee committee these and for delivering a ensures complete and adequate internationally recognised best business committee commensurate reward – ie value in its reporting. We have several policies and practices and frameworks. We broadest definition – within the charters governing the process and promote the sharing of knowledge parameters of the risk profile the board responsibilities. and learning on issues and good deems acceptable. The responsibility for management practice between managing risk lies with the owner of businesses within the group. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 53

Managing risks and opportunities continued

Our objective-driven dynamic Management and the board are Dynamic approach approach accountable for choices and decisions, Our overarching aim is to transform how we execute these and for our capitals for a net positive impact. delivering a commensurate reward – This approach gives rise to various risks, value in its broadest definition – within specifically over-using any of the six the parameters of the risk profile deemed acceptable by the board. Risk impact capitals (higher input than intended) Accepting risk is therefore at the heart Improvement opportunity or under-producing (lower output than intended). We may also identify of our decisionmaking processes. We Selected opportunities for greater efficiency set relevant tolerance levels for each objectives (lower input than anticipated) or more significant risk individually and manage effective production (higher output our business within these parameters. than anticipated) in any of the capitals We understand that certain risks may and therefore exceed against our have multiple consequences and that a original objectives. This can translate certain consequence may materialise into wasted resources. from different types of risk. The same applies to opportunities. Creating sustainable value is a continual Potential process of balancing available resources for optimal benefit to our entire stakeholder base. Business Strategy Sustainable opportunities delivery value Our way of viewing risks and opportunities In the face of uncertainty, risks may Capitals impact on our goals and objectives in transformation Performance multiple ways but, equally, opportunities may arise, allowing us to do better than the targets we have set. These risks and opportunities can be considered as potential negative and positive deviations from our goals and objectives. In our view, we can create competitive advantage through the opportunities we identify and select to pursue, and through the way we assess, manage and accept risk. It is a strategic approach to risk and opportunity.

For our stakeholders, opportunities and risks matter most where they have the greatest impact on value in its broadest sense. Therefore, we select opportunities and assess, manage and Our six capitals accept risks primarily on the basis of their potential impact on determined value drivers. Social and Financial Human Manufactured Intellectual Natural relationship capital capital capital capital capital capital 54 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Managing risks and opportunities continued

Key areas of focus in the year Future focus areas For the near future we do not foresee that Our key focus areas this year included: the key focus areas will become less relevant. In addition to these, we expect that the following topics will demand growing attention: Data-driven technologies As our businesses place greater emphasis on opportunities to enhance our services and customer experience through the development and deployment of data-driven technologies (such as machine learning and artificial intelligence), we need to understand and effectively manage the emerging risks that Right-sizing the Responding to Monitoring the Cybersecurity present themselves as a result. Such risks may relate to privacy and compliance in connection video-entertainment the Cape Town effectiveness of risk Our (newly implemented) cybersecurity with the use of (big) data, but also the control policy addresses security monitoring and over and consequences of transferring business water crisis and opportunity response to cyber-incidents. Our larger decisionmaking to what sometimes popularly businesses monitor their internal is referred to as ‘the black box’. We have embarked on a programme to We developed a focused response plan management network using security operations Sustainability optimise the structure and operations to ensure business continuity at our centres. We have implemented a of our video-entertainment businesses Media24 business regarding the water We undertake various actions to Through our policies and governance monitor the effectiveness of our risk platform to share threat intelligence to ensure sustainability and readiness crisis in the drought-stricken Southern across the businesses. Many of our structures we bring into practice our for further growth. Cape region of South Africa, including and opportunity management system commitment to ethical and sustainable and processes, and address outcomes. businesses have active responsible ready-to-use planning for extreme disclosure policies, which reward entrepreneurship, but also realise that the Read more on page 42 severity. communities we serve and our various Our internal audit and risk support researchers that identify vulnerabilities on our platforms. We have set up an stakeholders take a growing interest in Read more on page 47 group function conducts a number of the sustainability of our operations and risk-based audits in line with an annual initiative to improve our response capabilities, through a cyber-incident the impact of our corporate citizenship. audit plan approved by the audit We value our reputation and are fully committee. Risks and internal control response team. Some of our payments businesses are Payment Card Industry aware of the importance of our ‘social weaknesses or governance-related and relationship capital’. findings are discussed with senior Data Security Standard (PCI-DSS) compliant. These standards include management and the chief executive We understand that reputational risks relating and CFO of our business. Risk relevant requirements for confidentiality, integrity and availability of information. to our commitment predominantly come information is also discussed with the from misalignment of values or a deviation risk committee at least twice annually Compliance with relevant information from desired business culture, which in a when the committee meets. Action group as diverse and geographically spread items are communicated to and technology laws forms part of the legal compliance programme. as ours, naturally is a challenge to eliminate. management for corrective responses Throughout our group we will continue to or control redesign where applicable, Data privacy has been identified as emphasise the importance of ethical and and follow-up reviews are scheduled responsible behaviour and undertake various where required. a high-priority area and our privacy initiative is led by our group head of initiatives to ensure awareness of and adherence to our code of business ethics Read more on pages 55 to 57 data privacy. Our cybersecurity policy also sets standards specifically for and conduct, while promoting a culture of dealing with data privacy. integrated thinking in everything we do.

Read more on page 66 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 55

Managing risks and opportunities continued

Managing risks and opportunities These principles promote responsible As part of the process of integrated across the six capitals corporate citizenship and sustainable thinking, responsible corporate We are committed to good corporate development based on ethical leadership. citizenship and sustainable governance and to applying the development, we require businesses principles of the King Code on Both King IV™ and our sustainable to reflect on their business model Corporate Governance (King IV™). development policy require businesses in relation to the six capitals, as well to adopt integrated thinking in as the risks and opportunities linked to setting strategy. the six capitals.

Type of capital We aim to Key risks to this capital Measures to manage these key risks and maximise opportunities

Financial

We are a for-profit organisation that • Invest in countries where we operate by creating business for local • Global and political market disruptions. • We monitor global and political developments and adjust quickly. invests in developing businesses to suppliers, employing people and giving governments their dues via taxes • Failing to compete effectively. • We allocate significant resources to analysing market developments and provide useful products and services and levies. • Unexpected changes in the value of our assets. invest in early-stage opportunities to stay ahead. to customers and deliver a • Manage our assets and liabilities in a conservative manner with regard • Insufficient funding to realise our ambitions. • We have a fully funded three-year plan with room for M&A and manage the sustainable return to investors. to the interests of our investors and other stakeholders and in • Currency exchange fluctuations, and navigating balance sheet conservatively. accordance with board-approved risk appetite. exchange control. • We take action early to ensure we have the funds and resources to realise • Focus on investments in business models and technologies that hold • Credit risk. our ambitions. promise for future growth and have potential to scale globally. • Counterparty risk. • We invest funds and manage our cash in accordance with our group • Report accurately on our financial position and performance in • Fraud-related crimes and theft. treasury policy which, inter alia, sets minimum standards to mitigate risk of accordance with applicable accounting standards. • Financial misstatement and/or failure to counterparty default. • Comply with relevant company law and securities exchanges accurately disclose in our public reports. • We take out forward exchange contracts for up to 24 months to lock in regulations. costs and invest in a wide range of markets and currencies to diversify risk. • We operate an effective internal control environment and the audit committee oversees the effectiveness of combined assurance.

Human

We acknowledge that our • Attract and retain high-calibre individuals to execute on strategy and build • Failing to attract and retain talent to execute • Strategies to develop employees and attract talent to meet the business’s employees’ competencies, capabilities sustainable businesses. strategy. objectives, including learning and development initiatives (through and experience, as well their drive • Back entrepreneurs and local teams by providing them with resources • Non-compliance with applicable health and safety, MyAcademy that is online and classroom-based), training, and employee- and engagement, is key to our to accelerate growth. and labour and economic empowerment laws. wellness initiatives across the group. success. • Provide our employees with focused career development and training. • Inability of existing employees to adapt promptly • A global talent function that focuses on attracting, retaining, developing and • Foster a safe and healthy working environment where people feel to changes in market and innovation, and adapt engaging people with key skills and rewarding exceptional performance. cared for, heard and supported in their ambitions. business strategies accordingly. • Our legal compliance programme ensures compliance with applicable • Reinforce the leadership pipeline and accelerate the growth of top talent. • Unfair treatment and remuneration. occupational health and safety, labour, economic empowerment, • Support the ongoing development and growth of our businesses and • Inadequate development of employees. transformation and diversity laws. equip our people with new skills for tomorrow. • Human resource policies and procedures to address talent attraction, • Develop core business skills in ecommerce, video entertainment and management and retention, development, succession planning, fair and media. responsible remuneration, working conditions, grievance procedures and • Be fair and responsible in our remuneration practices and have a diversity. pay-for-performance remuneration strategy. • Initiatives to enhance our human capital include diversity and inclusion, • Encourage diversity in our teams and thinking, and build inclusive gender equality and leadership development. workplaces. Our employment philosophy is founded on promoting equality and preventing unfair discrimination. • Be compliant with relevant labour laws in the countries where we operate. 56 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Managing risks and opportunities continued

Type of capital We aim to Key risks to this capital Measures to manage these key risks and maximise opportunities

Manufactured

Manufactured capital is key to our • Ensure that office buildings, warehouses, retail outlets, vehicles and • Excessive write-offs or impairments of assets due • Robust business planning, including working capital. services and operations. equipment are efficient, well-maintained and adequately insured to poor maintenance or inadequate investments. • Adequate insurance. against relevant risks. • Reduced service delivery capacity as a result of • Maintenance programmes. Across the group, manufactured • Operate a secure and resilient technological infrastructure. risks affecting supply chain, logistics and processes • Business continuity planning, including disaster recovery and testing. capital may include: • Avoid obsolescence of products and services held for sale by (both physical and electronic). • Contracting with and regular performance evaluations of our service procurement and inventory management. • Product/Service offering, procurement, seller providers. • Office, service centre and • Minimise our investments in working capital. integration, and order and checkout flow. • Business and resource planning, including information and technology warehouse buildings and equipment. • Manage our outsource partners to deliver on agreed service levels. • Natural or human-induced disaster, and investment. • Information and technology political risk. • Asset maintenance programmes. infrastructure and equipment. • Technical failures and cyber-incidents • Insurance to protect business assets. • Distribution networks (such as causing disruption. • Responsible scaling strategies. customer service centres, retail • Business-continuity and disaster-recovery processes. outlets and courier services). • Public infrastructure such as roads The group’s subsidiaries are required to act in line with Naspers’s good for delivering goods. governance guidelines, which, inter alia, requires them to maintain business- • Vehicles. continuity and disaster-recovery plans. Businesses are responsible for ensuring • Inventory/Stock. adequate measures are in place for business and resource planning, supplier and external service provider selection, scaling strategies and insurance to protect their assets.

Intellectual

Intellectual capital (knowledge-based • Use intellectual capital to drive competitive advantage through • Ineffective response, including insufficient • Developing strategically important IP assets, as well as attracting, managing intangibles) includes intellectual customer-focused development and innovation strategies. innovation, to meet our customers’, changing and developing talent, encouraging innovation, and managing performance property (IP) such as patents, • Adequately protect our intellectual capital and not infringe on rights of demands and consumption patterns. to meet targets. copyrights, trademarks, domain others. • Improper use and/or inadequate protection of • Developing relationships to grow intellectual capital, for example names, confidential information, • Produce and acquire valuable content for consumption by our customer and privacy-sensitive data and other relationships with universities, think tanks and others. as well as institutional knowledge, customers through our various platforms. confidential information. • Protect IP rights against infringement through effective cybersecurity systems, procedures and culture. • Cultivate positive, innovative, ethical cultures within the group. • Failure to meet targets or lack of innovation. measures guided by our global security policy. • Build intellectual capital through continuous investment in our people • Loss of market share, revenue and opportunities • Support provided by group head of IP. Group guidelines and monitoring in and knowledge-sharing programmes throughout the group. through infringement, theft or misuse of the place. business’s IP rights. • Research and development spend strategies linked to value creation. • Reputational damage or liability due to infringement, theft or misuse of IP and rights of third parties by any of our businesses. • Insufficient production of intellectual capital caused by inadequate human resource development and culture. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 57

Managing risks and opportunities continued

Type of capital We aim to Key risks to this capital Measures to manage these key risks and maximise opportunities

Social and relationship

We acknowledge that we are • Build trust and maintain the businesses’ licences to operate, their • Unethical behaviour in breach of our code of • General ethics initiatives ensuring ethical standards for services and products required to act in line with our values brands and reputation. business ethics and conduct, including bribery provided. and code of business ethics and • Cultivate an ethical culture. and corruption and unfair treatment of • We continue to strengthen our regulatory teams, increase engagement with conduct, and manage both internal • Engage with our stakeholders and respond to legitimate and stakeholders. regulators and invest in corporate affairs, government relations and and external stakeholder reasonable issues raised. • Loss of consumer trust, for example failing to communication, while operating a robust legal compliance programme. relationships. • Meet the requirements of regulatory and financial authorities and deliver on our service promise, data-security • Anti-bribery and anti-corruption initiatives as part of the legal compliance participate in the development of policies beneficial to societies and breaches, non-compliance and inferior product programme. markets in which we operate. offerings. • Measuring and monitoring strength of customer relationships (such as net • Sustain corporate social initiatives focused, targeted and linked to • Non-compliance with laws and regulations in the promoter score) and strategy to ensure customer satisfaction. business strategy. countries where we operate, specifically, but not • Adopting measures to protect customers (including frameworks and policies limited to: company law, data privacy, anti-bribery in place, and training and awareness) and ensuring customer privacy and and anti-corruption, taxes and duties, licence data security are managed and monitored. This includes measures to conditions, consumer protection, anti-money- protect against cyberthreats. laundering, and international sanctions. • Managing stakeholder relationships and responding to legitimate and reasonable issues raised by major stakeholders. • Corporate social investment programmes that benefit the community and the business, such as providing learning and internship opportunities to students, contributing to the community and improving employment in the country, but also contributing to the human, intellectual and financial capitals of the business in the long term.

Natural

We acknowledge that we are required • Comply with laws and regulations that relate to the environment. • Increased natural hazard costs, security costs or • Reducing operational costs by minimising consumption and impact. to act in an environmentally responsible • To be useful to the communities we serve, acknowledging that resource costs. • Reducing environmental compliance/regulatory fees and charges. way. As an internet and entertainment environmentally responsible behaviour forms part of that. • Increased compliance costs, new regulations or • Our diverse businesses across the group adopt appropriate environmentally group, Naspers has a relatively low • Adhere to water preservation initiatives in the South African Western licence fees. sustainable practices minimising the impact on natural capital, for example impact on natural resources. Cape province, which is struck by severe drought. • Changing customer, supplier and employee energy-saving, water-saving and recycling initiatives. • Invest in high-growth markets and credible sustainable products that values or preferences may lead to reduced Our businesses consider the extent to may offer new revenue streams. market share and decreased loyalty. which natural capital may significantly • Local communities where we operate may face affect current or future operations; reduced access to, or availability of, natural capital trigger legal or regulatory processes or or related ecosystem services. fees, such as emission fees; have a financial impact, eg on insurance conditions; and affect company image or relationships with stakeholders, eg changing customer and employee preferences. Each business’s responses to mitigate key risks and pursue opportunities will differ depending on the unique risks and opportunities in their operating environments. 58 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Governance

Delhi, India Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 59 Our board

1 Bob van Dijk 4 Koos Bekker 7 Basil Sgourdos Chief executive – E, R, S Chair – E, H, N CFO – E, R, S (alt) 1 2 Bob was appointed chief executive of Naspers in Koos led the founding team of the M-Net/ Basil was appointed financial director of Naspers April 2014. He joined the group as Allegro MultiChoice pay-television business in 1985. in July 2014. As a qualified chartered accountant Group CEO in August 2013 and was promoted He was also a founder of the cellular telephony (SA), he worked at PricewaterhouseCoopers to CEO global transactions ecommerce in group MTN. Koos headed the MIH group in its Inc. from 1989 to 1994. Thereafter he joined October 2013. He has 15 years of general international and internet expansion until 1997, Naspers, initially as the finance manager of the management experience in online growth when he became chief executive of Naspers South African operations division in MultiChoice business across the world, spanning the online and led the group until 2014. He serves on the and then as chief financial officer of our market-places, online classifieds and etail boards of other companies in the wider group. investment in the Thai-listed United segments. Prior to his general management In April 2015 he succeeded Ton Vosloo as Broadcasting Corporation Plc., where he career, Bob was a founder of an online financial non-executive chair of Naspers. He holds a remained for 10 years. Basil then spent two derivatives marketplace. He started his career BAHons and an honorary doctorate in commerce years in Amsterdam as general manager of in McKinsey with a focus on mergers and from Stellenbosch University, an LLB from the global pay-television business development, 3 4 acquisitions, and media. Bob has an MBAHons University of the Witwatersrand and an MBA before being appointed as group chief financial from INSEAD and an MSc (cum laude) in degree from Columbia University, New York. officer of MIH in January 2009. He held this econometrics from Erasmus University, position until he became group chief financial Rotterdam. officer of the Naspers group on 1 July 2014. 5 Craig Enenstein H, N 2 Don Eriksson 8 Debra Meyer Craig is the CEO of Corridor Capital, LLC, an A, R, S operationally intensive private equity firm S Don is a chartered accountant (SA) and an focused on the lower middle-market. Corridor Debra is professor of biochemistry and honorary life member of the Institute of Capital, LLC is based in Los Angeles and was executive dean of the faculty of science at the Directors of Southern Africa (IoDSA). He is founded by Craig in 2005. He holds an MBA in University of Johannesburg. She was a Fulbright chair of Oakleaf Insurance Company Limited, finance (Wharton School of Business, University Scholar at the University of California, Davis, Renasa Insurance Company, NMSIS Insurance of Pennsylvania), an MA in international studies where she obtained a PhD in biochemistry and 5 6 Services and of the audit and risk committees (Lauder Institute, University of Pennsylvania) and molecular biology. She has completed modules of MultiChoice South Africa Holdings. He also a BA (University of California, Berkeley). in media strategy and academic leadership at serves as an independent non-executive Harvard and Gibs (University of Pretoria) and director of Naspers Limited and chairs the audit, makes regular contributions to several risk, and social and ethics committees of the 6 Rachel Jafta newspapers and magazines. Debra serves Naspers group. Don served on the council A, R, N, S as trustee and board member of several of IoDSA and as a Trustee to the Discovery Rachel holds the degrees MEcon and PhD, and is organisations. Health Medical Aid for a number of years. a professor of economics at Stellenbosch He was a partner at Coopers & Lybrand (now University. She joined Naspers as a director in PricewaterhouseCoopers Inc.) and an executive 2003 and was appointed a director of Media24 director of the Commercial Union group in 2007. She is a member of the South African of companies. E Executive committee Economic Society, director of Econex, chair of 7 A Audit committee the Cape Town Carnival Trust and a member of 3 Nolo Letele the management committee of the Bureau for R Risk committee S Economic Research at Stellenbosch University. H Human resources and She is a member of the human resources and remuneration committee Nolo joined M-Net in 1990 and pioneered remuneration committee of Media24 and chair MultiChoice’s expansion outside South Africa. of the nomination committee of Media24. She N Nomination committee In 1995 he moved to Ghana, where he served as was appointed chair of the Media24 board in S Social and ethics committee West African regional general manager. In 1999 April 2013 and on 9 June 2015 she was he was appointed chief executive of MultiChoice appointed to Naspers’s audit and risk SA, and later served as the MultiChoice group committees. She has been serving on the chief executive until 2010, when he was international advisory Council of Fondação appointed executive chair of the MultiChoice Dom Cabral Business School, Brazil since 2015. South Africa Holdings board. Nolo has won 8 several awards, including Media Man of the Year in 2001 (Saturday Star – Business Report); Media Owner of the Year in 2003 (Financial Mail Adfocus) and the Lifetime Africa Achievement Prize for media development in Africa (Millennium Excellence Foundation). He holds an honours degree in electronic engineering (UK). Executive Non-executive Independent non-executive 60 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Our board continued

9 Ben van der Ross 13 Guijin Liu 16 Steve Pacak A, R E, R 9 10 11 Ben holds the qualification DipLaw (University Guijin graduated from Beijing University of Steve, a chartered accountant (SA), began his of Cape Town) and is an admitted attorney. Foreign Studies in 1971 and joined the Ministry career with Naspers at M-Net in 1988 and has He has previously served, among others, on of Foreign Affairs. He served in the General held various executive positions in the Naspers the boards of FirstRand Limited, MMI Holdings Office of MFA, various Chinese Embassies and in group. He is a director of MultiChoice South Limited, Pick ‘n Pay Holdings Limited, Distell the Department of African Affairs for many Africa Holdings and other companies in the Limited and Lewis Group Limited. years. Guijin is experienced in international wider Naspers group. He was appointed an affairs, particularly regarding relations between executive director of Naspers in 1998 and a China and the developing world, such as Africa. non-executive director in January 2015. He 10 Fred Phaswana He has contributed to international conferences retired as Naspers’s financial director on 30 June E, H, N of the UN, AU and other organisations 2014, but remained on the board as an alternate Fred holds the qualifications MA (Unisa) and representing China. Recently he participated in non-executive director. BComHons (Rand Afrikaans University, now high-level academic forums including the WEF 12 13 and the Summer Davos. Guijin currently serves University of Johannesburg), and obtained a BA 17 Cobus Stofberg (philosophy, politics and economics) from Unisa as president of the Chinese Society of Asia and in 2010. He joined Naspers as a director in 2003. Africa Studies. S He is joint chair of the Mondi Group and former Cobus is a founder member of M-Net. He chair of The Standard Bank Group and of 14 Roberto Oliveira de Lima served as chief executive of the MIH group from Standard Bank of South Africa Limited. 1997 to 2011 and has been instrumental in the H expansion of the group. Prior to M-Net, he was Roberto graduated in public administration a partner of Coopers & Lybrand (predecessor 11 Hendrik du Toit and has a post-graduate degree in business of PricewaterhouseCoopers Inc.). He holds N management from Fundação Getúlio Vargas in a BComLaw and LLB from Stellenbosch Hendrik is chief executive officer of Investec Brazil. Roberto also has a specialisation in finance University, BComptHons from Unisa and and strategic planning from Institut Supérieur is a qualified chartered accountant (SA). Asset Management and a director of Investec plc 14 15 and Investec Limited. He holds an MPhil in des Affaires in France. He developed his career economics and politics of development from in companies like Saint Gobain, Rhône-Poulenc Cambridge University, as well as an MCom in and Accor Group in the information technology economics (cum laude) from Stellenbosch and finance areas. He was chair and CEO of University. Hendrik is currently a member of the Credicard Group, CEO of Vivo SA, the largest Global Business and Sustainable Development mobile telecommunications company in Brazil, Commission. chair of Publicis Brazil and president of Natura SA. He has been serving as a board member for Edenred in France, Pão de Açúcar (Casino) and 12 Mark Sorour(1) Natura SA in Brazil since 2011. Currently, he is a member of the board of directors of Telefônica Brasil SA, RNI Negócios Imobiliários SA and E Executive committee Mark joined the Naspers group in 1994, heading Petrobras Distribuidora SA. up business development and corporate finance 16 A Audit committee globally. Following a tour of duty in Hong Kong R Risk committee and Amsterdam, he returned to Cape Town as 15 Emilie Choi group chief investment officer and had the R, H H Human resources and responsibility for all global investment activities. remuneration committee Emilie runs and oversees corporate and business On 31 March 2018 Mark retired after more than N Nomination committee 20 years with the group. Mark remained on the development, business operations and analytics, board as a non-executive director. Mark is a and ventures businesses for Coinbase. Prior to S Social and ethics committee qualified chartered accountant (SA) holding a Coinbase, she ran corporate development for LinkedIn and led all M&A deals in the company’s Note BCom and DipAcc. (1) history, including Lynda, Connectifier, Bizo, Appointed as non-executive director Newsle, Bright, Pulse, SlideShare, Connected, on 31 March 2018. Rapportive, IndexTank and CardMunch, as well as leading the LinkedIn JV deal in China. 17 Prior to LinkedIn, Emilie worked in corporate development and strategy roles at Warner Bros. Entertainment as well as Yahoo Inc., where she worked on such deals as Flickr and the Yahoo investment in Alibaba. Emilie holds an MBA from Wharton School at the University of Pennsylvania and a BA in economics from Executive Johns Hopkins University. She joined the Naspers board as a director in 2017. Non-executive Independent non-executive Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 61

Our board continued

BOARD COMPOSITION LENGTH AND TENURE Attendance at board meetings The board is the Date first appointed in Board member Date last appointed Attendance Category decisionmaking current position body for all J P Bekker(2) 17 April 2015 25 August 2017 8/8 Non-executive E M Choi 21 April 2017 21 April 2017 8/8 Independent matters of such non-executive importance as H J du Toit 1 April 2016 1 April 2016 8/8 Independent to be significant non-executive to the group C L Enenstein 16 October 2013 28 August 2015 8/8 Independent as a whole. non-executive Number of directors Number of directors CHAIR 1 0–2 YEARS 1 D G Eriksson 16 October 2013 28 August 2015 8/8 Independent non-executive EXECUTIVE 3 2–4 YEARS 5 INDEPENDENT NON-EXECUTIVE 10 4– 6 YEARS 7 R C C Jafta 23 October 2003 25 August 2017 8/8 Independent NON-EXECUTIVE 3 6–9 YEARS + 4 non-executive

F L N Letele 22 November 2013 26 August 2016 8/8 Executive NATIONALITIES GENDER DIVERSITY FEMALE MALE G Liu 1 April 2016 1 April 2016 7/8 Independent non-executive

Number of directors D Meyer 25 November 2009 26 August 2016 8/8 Independent Numer of directors non-executive R Oliveira de 16 October 2013 26 August 2016 8/8 Independent Lima non-executive (2) S J Z Pacak 15 January 2015 25 August 2017 8/8 Non-executive T M F 23 October 2003 25 August 2017 7/8 Independent (2) Number of directors Phaswana non-executive SOUTH AFRICA 12 M R Sorour(1) 15 January 2015 28 August 2015 8/8 Non-executive USA 2 BRAZIL 1 V Sgourdos(2) 1 July 2014 29 August 2014 8/8 Executive CHINA 1 J D T Stofberg 16 October 2013 26 August 2016 8/8 Non-executive THE NETHERLANDS 1 B van Dijk(2) 1 April 2014 29 August 2014 8/8 Executive B J van der Ross 12 February 1999 25 August 2017 7/8 Independent non-executive

Notes (1) Appointed as non-executive director 1 April 2018. (2) Members of the executive committee. 62 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information Governance for a sustainable business

The board of directors conducts the monitor regulatory developments, Naspers has a governance committee system and process changes to enable group’s business with integrity by locally and internationally, to enable (formerly internal control oversight the implementation of recommended “I am pleased to present this applying appropriate corporate management to make recommendations forum) comprising the chief financial or alternative practices to demonstrate year’s governance report. It governance policies and practices. to the Naspers board on matters of officers (CFOs) and risk and internal application of King IV™’s principles. has been a stand-out year Our aim is to keep abreast of regulatory corporate governance. audit managers of Naspers, Naspers Focus areas for the 2018 financial year developments, further enhance our Ecommerce, Video Entertainment included, but were not limited to, and we have continued governance standards, monitor and How we integrate governance and Media24, the Naspers group enhanced disclosures in the 2018 to improve our processes, ensure compliance with relevant laws into our business company secretary, the Naspers global integrated annual report and continued and regulations and cultivate a thriving Naspers recognises the value of an governance partner and group general focus on governance of information and especially around ethical organisational ethical culture in the integrated approach to assurance and counsel. The committee was tasked to technology, in particular, information and conduct management.” different geographies where the group compliance. The adopted governance, ensure the Naspers group’s governance technology security. operates. We also aim to maintain a high risk and compliance framework structures and framework are Koos Bekker standard of reporting and disclosure, continues to form the basis for how employed in the in-scope entities in All board and board committee Chair keeping in mind the best interests of Naspers manages governance. the group during the financial year. charters and policies were reviewed our stakeholders and disclosing what is Governance and progress are with a view to aligning them with the relevant and important to the The governance framework shows the monitored by the audit and risk recommendations contained in sustainability of the group. achievement of a sustainable business committees and reported to the board. King IV™ and the requirements of the integrated with governance, assurance, amended JSE Listings Requirements. Refer to the full governance report for risk management and compliance, in The composition of committees of the a detailed review of the board and its accordance with legislated requirements board and committees of the boards of King IV™ advocates a qualitative committees. and this is reported through the MultiChoice and Media24 is reviewed approach to implementing relevant structures. annually and, where required, amended. recommended practices to achieve Introduction the application of the principles and Naspers group governance Details of the enterprisewide risk to realise the intended governance Naspers has a primary listing on the JSE management framework appear on outcomes. King IV™ states that Limited (the JSE). The company is framework page 52. recommended practices are meant to be scaled in accordance with the therefore subject to the JSE Listings The Naspers board is the focal point Statement of the board proportionality considerations of the Requirements, the guidelines in the for and custodian of the group’s Naspers is required, in terms of the JSE various businesses in our group. We King IV™ Report on Corporate corporate governance systems. The Listings Requirements to report against take into account proportionality when Governance for South Africa, 2016 board conducts the group’s business the application of the principles of we apply corporate governance in the (King IV™), as well as legislation with integrity and applies appropriate King IV™. In line with the overriding group. This means we apply the applying to publicly listed companies corporate governance policies and principle in King IV™ of apply and practices needed to demonstrate the in South Africa. Naspers also has a practices in the group. secondary listing of its American explain, the board, to the best of its group’s governance in terms of knowledge, believes the group has King IV™ as appropriate across the Depository Shares (ADSs) on the The Naspers board, its committees, satisfactorily applied the principles of group. The companies in our group are London Stock Exchange (LSE). and the boards and committees of King IV™. For a more detailed review diverse and at different maturity stages, In addition, a subsidiary, Myriad subsidiaries MultiChoice and Media24 see the King IV™ application report. a one-size-fits-all approach therefore International Holdings B.V., has bonds, are responsible for ensuring the cannot be followed when implementing guaranteed by Naspers, which are appropriate principles and practices governance practices. All good listed on the Irish Stock Exchange (ISE). of King IV™ are applied and embedded Our journey to align with governance principles apply to all in the governance practices of group ™ King IV and approach to types and sizes of companies, but the The audit and risk committees of the companies. board monitor compliance with the apply King IV™ practices implemented by different companies to achieve the principles JSE and applicable LSE and ISE listings A disciplined reporting structure Following the release of the King IV™ may be different. Practices must be requirements. ensures the Naspers board is fully report in November 2016, we reviewed implemented as appropriate for each apprised of subsidiary activities, risks and interpreted King IV™ for the company in line with the overarching The board’s executive, audit, risk, and opportunities. All controlled human resources and remuneration, Naspers environment. King IV™ good governance principles. entities in the group are required to awareness initiatives and a review of the nomination, and social and ethics subscribe to the principles of King IV™. committees fulfil key roles in ensuring Naspers board policies, charters and Business and governance structures governance practices formed the starting good corporate governance. The group have clear approval frameworks. uses independent external advisers to point. In the 2018 financial year we made Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 63

Governance for a sustainable business continued Naspers group governance framework Ultimately we report to stakeholders in the integrated report and other releases

Board Supported by Reporting to ensure company accountability in these secretary/ governance areas governance Performance against strategy (financial and Board non-financial: six capitals) Read more on page 18

Business ethics Read more on page 65

Responsible corporate Board citizenship committees Read more on Supported by pages 36, 43, 46, 47 company and 65 secretary/ Resp D f M emuneration hics on ele t o an R n et sib Risk governance governance g n t a tio l c le at e n ec ge si na iti s io m tio h m o io ze co ie n e a n p t n r Read more on c g o e a s p li t a m lo n m s h o r t i o page 52 o n g o B n ip r p m o y o c a f o a a n f e a i e a g t c M r e n e r t n a d t O a i g Human Technology and n d e

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Combined assurance Read more on Management page 6 and group Stakeholder relationship support governance functions Group support functions Read more on page 20 Group and Naspers Management • Human resources • IARS** segment governance of operating and remuneration • Finance Group governance management committee businesses • Legal compliance* • Data privacy Read more on • Tax • Intellectual property page 58 • Investor relations Remuneration governance Read more on Underlying page 68 framework Values Code of business Strategy Various charters Naspers good foundation ethics and conduct and policies*** governance guidelines

*Including data privacy **Internal audit and risk management support ***Refer to application of King IV™principles for further explanation 64 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Governance for a sustainable business continued

Progress made and King IV™ milestones

2016 2017 2018

Aligned board committee reports and information and technology November 2016 to June 2017 June 2017 to July 2017 September 2017 and enhanced reporting to board governance (including data April 2018 Analysis and review Approval of charters and policies to March 2018 committees to enable reporting privacy and cybersecurity) Finalise and approve Enhancing report on King IV™ in the 2018 integrated and to the social and ethics • Interpreted King IV™ for the • Consultation with and feedback from the MultiChoice annual report and King IV™ committee on organisational After year-end (31 March 2018), the Naspers environment. Detailed South Africa and Media24 boards and segment chief templates and application report. ethics, stakeholder relationship businesses will be required to sign off King IV™ gap analysis conducted financial officers and general counsels on Naspers’s reports to board through an annual sign-off process on the Enhanced reporting to all board management, corporate at a Naspers group level. governance framework were incorporated. committees citizenship and extent of implementation of Naspers’s committees, including to the risk guidelines and policies. • Reviewed Naspers board and • The reviewed policies and charters were approved by committee on legal compliance sustainable development. board committee charters, policies the relevant board committees and ultimately the and governance practices to align board on 23 June 2017. to King IV™. • King IV™ taskforce established, consisting of the group • Developed King IV™ and other company secretary, group general counsel, assistant governance webinars on the group company secretary, global governance partner, MyAcademy platform to promote head of internal audit and risk support and global April 2018 awareness. Other webinars legal compliance lead. Initial King IV™ taskforce September 2017 included training modules for workshop to formulate King IV™ implementation plan. to October 2017 Future focus directors and on the JSE Listings • Formulated Naspers’s good governance guidelines Roadshows kicked off Areas include continuous enhancement of Requirements, data privacy and our requirements and practice guidelines (‘the good • Naspers’s governance guidelines. communications policy. Roadshows to in-scope subsidiaries to governance guidelines’), setting out the key communicate Naspers’s requirements as • Reporting to the board, board governance elements subsidiaries need to observe as set out in the Naspers group policies and committees and in the integrated part of the Naspers group governance framework. the good governance guidelines. In-scope annual report. The good governance guidelines consider subsidiaries include Avito, eMAG, iFood, • Engagement with investors on proportionality, as explained above. Irdeto, Media24, Movile, MultiChoice environmental, social and governance Africa, MultiChoice South Africa, Naspers, (ESG) matters. OLX, PayU and Takealot.

Nov Jun Jul Sep Oct Mar Apr

Ongoing interaction, • Engagement with business on progress in • Regular reporting to taskforce, Naspers internal • Define what needs to be reported implementing guidelines and reporting overview control forum, board committees and to the board and board committees, support and guidance requirements. board on progress made in the implementation align committee reporting templates • Support to business to implement policies of the King IV™ plan. and enhance reporting. and principles.

Approach to King IV™ rollout: • Expectations on requirements to address gaps on current structure, processes and reporting were communicated to subsidiaries. • Responsibilities assigned for different reporting areas to representatives in Naspers and group businesses. • Reporting process, including reporting templates and tools, developed and distributed to Naspers subsidiaries. • CFO and legal counsels in segments and subsidiaries responsible for leading the rollout in their segments and subsidiaries. • Connecting King IV™ and other group initiatives, leverage on existing structures, processes and materials. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 65

Governance for a sustainable business continued

Business ethics related matters via the Naspers ethics external whistleblower facility, throughout the group. In-scope refer to the social and ethics committee performance, using the six-capitals officer, who is the central Naspers OpenLine, operated by Deloitte’s subsidiaries included Avito, Buscapé, report in the full governance report. reporting framework – refer to the The group’s code of business ethics contact for Naspers ethics matters, to Tipoffs Anonymous. Details of this eMAG, iFood, Irdeto, Media24, Movile, social and ethics committee report in and conduct is available on the social and ethics committee. Ethics facility are published on the corporate MultiChoice Africa, MultiChoice South Key areas of focus going forward include the full governance report. We www.naspers.com www.naspers.com. officers’ responsibilities include: website, . All Africa, Naspers, OLX, PayU and regular engagement between the recognise that sustainable development stakeholders can report unethical Takealot. The training methods used by group’s ethics officers, where they can and economic, social and environmental This code applies to all directors and • Understanding and applying the code behaviour and wrongdoing anonymously subsidiaries included elearning modules share experiences, identify ethics protection are global imperatives that employees in the group. Ensuring that of business ethics and conduct (the and confidentially. The line operates on the MyAcademy platform, challenges and share best practice. present both opportunities and risks for group companies adopt appropriate code) and whistleblower policy. globally, 24/7/365 with live answering. face-to-face training, presentations and This will establish a Naspers-designated business. We build leading companies processes and establish supporting • Upholding corporate values. storyboarding for disabled employees. ethics officers’ community and assist us that empower people and enrich policies and procedures is an ongoing • Managing internal speak-ups and This year we embarked on an Elearning modules were translated into in tailoring tools and support. communities. Corporate citizenship process. Management focuses on providing guidance. awareness campaign across the group, Portuguese, Spanish and Russian. is integral in the way we do business. policies and procedures that address • Assisting with awareness campaigns with the theme ‘It’s your business’. The Further translations planned include We plan to launch an ethics key ethical risks, such as conflicts of on the code and whistleblower policy. campaign led to our group companies Romanian and Bulgarian. In-scope reawareness campaign for in-scope An overview of our capitals and value interest, accepting inappropriate gifts • Maintaining confidentiality in relation setting the tone of reporting unethical subsidiaries were determined based subsidiaries and to assess launching an creation is provided on pages 18 and 28. and acceptable business conduct. to ethics-related matters. business practices. on proportionality and maturity. ethics-awareness campaign for other • Maintaining records and reporting on subsidiaries, taking into account Going forward, management will The social and ethics committee is ethics-related matters. It’s your business/speak out The Naspers social and ethics proportionality. enhance reporting techniques on responsible for overseeing and committee receives reports on business how it reports to the social and ethics reporting on business ethics in relation To facilitate disclosure of improper During the year we created awareness ethics management and monitoring – Stakeholder relationships committee on responsible corporate to the Naspers group, taking into conduct, Naspers has an independent on the code and whistleblower policy citizenship and sustainable development account specific disclosures and best Representatives of our businesses manage using the six-capitals reporting framework. practice as recommended by King IV™. various external and internal stakeholder Businesses in our group apply zero Openline operates globally relationships. Our businesses manage Legal compliance tolerance to violations of the code by their stakeholder relationships based on taking the necessary action, including a stakeholder-inclusive approach that Legal compliance falls within the improving the control environment or balances the needs, interests and responsibilities of the group general taking the necessary disciplinary, criminal expectations of material stakeholders counsel, who is also the chief legal or civil action. Reports are provided to in the best interests of the businesses. compliance officer. The Naspers board the social and ethics committee to has delegated the responsibility for demonstrate this. Unethical behaviour To support the board to fulfil its by senior employees is also reported to governance role, the Naspers social and the human resources and remuneration ethics committee receives reports on committee, along with the way the stakeholder management across the company’s disciplinary code was applied. group – refer to the social and ethics committee report on page 21 of the Naspers is committed to conducting its full governance report. business on the basis of complying with the law, with integrity and with proper An overview of our stakeholders and regard for ethical business practices. It stakeholder engagement is provided on expects all directors and employees to page 20. comply with these principles and, in particular, to avoid conflicts of interest Sustainable development and not to engage in insider trading, illegal anti-competitive activities, and and corporate citizenship bribery and corruption. Naspers’s commitment to sustainable During the year we designated 12 ethics development and corporate citizenship officers around the group. These is articulated in its sustainable officers serve as central points of development policy. To support the contact for advice on ethics-related board to fulfil its governance role, the queries, improprieties, allegations and social and ethics committee receives complaints. They report on ethics- reports on Naspers’s social and ethics 66 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Governance for a sustainable business continued

overseeing legal compliance to the risk The enhanced groupwide legal Information and technology capability of businesses to respond to Penalties committee of the Naspers board. To compliance, anti-bribery and anti- disruption is in scope for internal audit, assist the risk committee in discharging corruption, sanctions and export governance bearing in mind the perspective of our Because MultiChoice operates in a this responsibility, the chief legal controls and competition compliance Information and technology (I&T) customers and end users. highly regulated environment in South compliance officer reports on legal policies were reviewed and approved by governance is integrated in the operations Africa, compliance is important. The compliance to the risk committee. Legal the Naspers board in June 2017. of the Naspers businesses. Management A comprehensive code of business ethics company participates in the regulatory compliance is a standing agenda point. of each subsidiary or business unit is and conduct is in place. In addition, the process affecting its industry through Responsibility for legal compliance in Assurance on the effectiveness of responsible for ensuring effective operational boundaries to dealing with various public forums and debates, each segment rests with the general compliance management is received processes on I&T governance are in place. I&T are subject to the group’s legal providing inputs on formulating standards counsel of that segment, who oversees through a combined assurance model. compliance policy. Our risk management and strategies for the industry. legal compliance for the subsidiaries The risk committee assists the board practices ensure that relevant risks within his or her segment. As part of the enhanced legal compliance with overseeing I&T-related matters. I&T relating to the ethical and responsible use MultiChoice and M-Net received fines framework, each segment is required to governance is a standing point on the risk of technology and information are from the self-regulatory body, the During the 2017 and 2018 financial provide a quarterly legal compliance committee agenda. I&T objectives have identified and assessed. Our social and Broadcasting Complaints Commission years the group has been enhancing report to the group legal compliance been included in the risk committee ethics committee oversees this area. We of South Africa (BCCSA). These relate its legal compliance framework by function. This report includes an charter. The risk committee considers are running a privacy programme to to failure by channels to provide correct identifying key legal compliance risks. overview of key compliance risk areas the risk register, as well as reports on I&T ensure that the personal data of our classification information, resulting in The enhancements respond to the and mitigating measures, key compliance from internal audit and risk support and suppliers, customers and employees is MultiChoice and M-Net contravening increased expectations of regulators regulatory developments and material our legal compliance function. stored and processed in an ethical the BCCSA Code. and stakeholders. In addition, they align compliance incidents and investigations. manner and in compliance with relevant the group to market conditions, which The group legal compliance function The group’s subsidiaries are required to privacy laws. A key focus for the new Fines paid to the BCCSA: show a deepening of policies and uses these reports to compile a act in line with Naspers’s good financial year is the Protection of procedures as relevant areas of the consolidated report that is reviewed governance guidelines, which, among Personal Information (PoPI) Act, which • 2016 financial year: R10 000 law and best practice become more by the chief compliance officer and is others, detail I&T governance-related promotes the protection of personal • 2017 financial year: R90 000, and developed. subsequently provided to the risk matters. Subsidiaries of each major entity information by public and private bodies • 2018 financial year: Rnil. committee of the Naspers board. are required to submit an annual formal in South Africa and General Data The legal compliance framework includes written report on the extent to which Protection Regulation (GDPR), a Several media industry players, including the following: Planned areas of future focus for legal they have implemented the principles, regulation in the European Union (EU) MultiChoice and Media24, have settled compliance include continuing to raise and chief executives and CFOs sign off on data protection and privacy for all the industrywide advertising discounts • Groupwide policies that apply to every compliance awareness across the group. thereon. Any notable exceptions are individuals within the EU addressing the matter with the Competition legal compliance programme in the Improvements to the legal compliance summarised and reported to the risk export of data outside the EU. Commission of South Africa, entering group, built on the principles in the framework will be made based on committee. into consent agreements with the code of business ethics and conduct. emerging risks, feedback from Internal audit provides assurance to Competition Commission. The Subsidiaries are responsible for monitoring activities and a greater focus We continuously look at how we can management, the audit committee and agreements were approved by the implementing a fit-for-purpose legal on third-party screening. With internal better integrate people, technologies the board on the effectiveness of I&T Competition Tribunal. DStv Media Sales compliance programme based on the audit, we will also be focusing on our and processes. During the year, we have governance. The detail of controls to Proprietary Limited (DMS), a subsidiary of risks applicable to their business but, as assurance framework. made further progress in implementing manage identified risks and reduce MultiChoice, agreed that an administrative a minimum, containing these group SAP across the group to unify key vulnerability forms the basis of internal penalty of R22m be paid (provided for in policies. There were no material or repeated finance business processes. During our audit’s assurance plans. the prior financial year) and a contribution • A compliance toolkit including detailed regulatory penalties, sanctions or fines annual business planning process, our of R8m, payable over three years, to a guidelines and resources based on the for contraventions of, or non- various businesses consider their To support the board to fulfil its fund to be administered through an group policies to be tailored by the compliance with, statutory obligations. platform requirements. The platform governance role, the Naspers risk industry trust to assist small black-owned segments and businesses to reflect strategy starts from the business committee receives reports on I&T media agencies. Media24 agreed to pay local legal requirements and risks. There were no inspections by strategy and is translated into technical management – refer to risk committee R14m and R5m respectively. environmental regulators or findings of and process requirements. report on page 27 of the full The legal compliance programme is led non-compliance with environmental laws. governance report. During the past year there were no by the chief compliance officer and global Business continuity is included in the environmental accidents, nor were any compliance lead with support from To support the board to fulfil its group’s risk register, which is reviewed Planned areas for future focus for I&T environment-related fines imposed by external consultants. governance role, the Naspers risk and discussed by the risk committee governance include the development any government. committee receives reports on legal twice a year and, annually, by the board. and deployment of data-driven compliance – refer to the risk Business resilience is the key objective technologies (such as machine learning committee report on page 27 of the of our cybersecurity policy. The and artificial intelligence), cybersecurity full governance report. and data privacy. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 67

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Internal control systems to input, including reports from internal The audit committee preapproves audit As required by JSE Listings Requirement to provide forward-looking information. audit and the external auditor, and non-audit services to ensure these 3.84(h), the board has determined that Naspers complies with legislation and As part of the overall management of compliance and the risk management do not impair the auditor’s the company secretary, who is a stock exchange rules on forward- risk, the system of internal controls in all process. Where necessary, programmes independence and comply with chartered accountant (SA) with more looking statements. material subsidiaries and joint ventures for corrective actions have been legislation. Under our guiding principles, than 25 years’ company secretarial under the company’s control aims to initiated. the auditor’s independence will be experience, has the requisite Closed periods prevent and detect any risk materialising deemed impaired if the auditor competence, knowledge and Naspers would typically be in a closed and to mitigate any adverse Nothing has come to the attention of provides a service where he/she: experience to carry out the duties of a period on the day after the end of a consequences thereof. The group’s the board, external or internal auditors secretary of a public company and has reporting period (30 September or system of internal controls is designed to indicate any material breakdown in • functions in the role of management an arm’s length relationship with the 31 March) until the release of results. to provide reasonable, and not the functioning of internal controls and of the company, or board. The board is satisfied that the General investor interaction during this absolute, assurance on the achievement systems during the year under review. • audits his/her own work, or arrangements for providing corporate time is limited to discussions on strategy of company objectives, including • serves in an advocacy role for the governance services are effective. and/or historical, publicly available integrity and reliability of the financial Internal audit company. information. statements; to safeguard, verify and Investor relations maintain accountability of its assets; and An internal audit function is in place Company secretary Analyst reports to detect fraud, potential liability, loss throughout the group. The head of Naspers’s investor relations policy can To enhance the quantity and quality of and material misstatement while internal audit reports to the chair of The company secretary, Gillian be found on www.naspers.com. It research, Naspers maintains working complying with regulations. For those the Naspers audit committee, with Kisbey-Green, and David Tudor, group describes the principles and practices relationships with stockbrokers, entities in which Naspers does not have administrative reporting to the financial general counsel (and legal compliance applied in interacting with shareholders investment banks and credit-rating a controlling interest, the directors director. A large part of the internal officer), are responsible for guiding the and investors. Naspers is committed to agencies – irrespective of their views representing Naspers on these boards audit fieldwork is co-sourced. board in discharging its regulatory providing timely and transparent on or recommendations to the group. seek assurance that significant risks are responsibilities. information on corporate strategies and Naspers may review an analyst’s report managed and systems of internal Internal audit annually provides a financial data to the investing public. In or earnings model for factual accuracy control are effective. statement on the effectiveness of Directors have unlimited access to the addition, we consider the demand for of information in the public domain, but Naspers’s governance, risk management advice and services of the company transparency and accountability on our in line with regulations and group policy All internal control systems have and control processes to the audit secretary. She plays a pivotal role in the non-financial (or sustainability) we do not provide guidance or shortcomings, including the possibility of committee. An independent review on company’s corporate governance and performance. In line with King IV™, we forecasts. human error or flouting of control internal audit is done at least every five ensures that, in accordance with the recognise that this performance is based measures. Even the best system may years. The last review was performed pertinent laws, the proceedings and on the group’s risk profile and strategy, The board encourages shareholders to provide only partial assurance. In the by PwC in 2017. The head of internal affairs of the board, the company itself which includes non-financial risks and attend the annual general meeting, dynamic environment in which the audit and risk support confirms annually and, where appropriate, shareholders opportunities. notice of which is contained in this company operates, management to the board that internal audit are properly administered. She is also integrated annual report, where regularly reviews risks and the design of conforms to meet the International the company’s compliance officer as The company manages communications shareholders have the opportunity to the internal controls system to address Standards for the Professional Practice defined in the Companies Act and with its key financial audiences, including put questions to the board, these, assisted by the work and reports of Internal Auditing of the Institute of delegated information officer. The institutional shareholders and financial management and the chairs of the from internal audit on the adequacy and Internal Auditors and its code of ethics. company secretary monitors directors’ (debt and equity) analysts, through a various committees. operational effectiveness of controls, dealings in securities and ensures dedicated investor relations unit. which may indicate opportunities for Non-audit services adherence to closed periods. She Presentations and conference calls take The company’s website improvement. The external auditor attends all board and committee place after publishing interim and final www.naspers.com provides the considers elements of the internal The group’s policy on non-audit meetings. In accordance with King IV™ results. latest and historical financial and other controls system as part of its audit and services provides guidelines on dealing the performance and independence of information, including financial reports. communicates deficiencies when with audit, audit-related, tax and other the company secretary is evaluated A broad range of public communication identified. non-audit services that may be provided annually. channels (including stock exchange by Naspers’s independent auditor to news services, corporate website, The board reviewed the effectiveness group entities. It also sets out services press agencies, newswires and news of controls for the year ended 31 March that may not be performed by the distribution service providers) is used 2018, principally through a process of independent auditor. to disseminate news releases. These management self-assessment, including channels are supplemented by direct formal confirmation in the form of communication via email, conference representation letters by executive calls, group presentations and management. Consideration was given one-on-one meetings. Our policy is not 68 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information Remuneration report for the year ended 31 March 2018

Dear Shareholder We have made several changes to the “We aim to attract, design of executive remuneration for On behalf of the board, I am pleased the forthcoming 2018/2019 financial How we add value motivate and retain to present our 2017/18 remuneration year. These are detailed in sections 1 We pursue growth by building leading companies the best leaders, report. and 3. When making executive awards, that empower people and enrich communities. entrepreneurs, the committee has considered the need This report is my first in the chair of the to maximise shareholder value. Details What we do: creative engineers human resources and remuneration of the cost of our long-term incentives and employees to committee. I welcome fellow directors can be found on page 90. Emilie Choi and Roberto Oliveira de create sustainable Lima to the committee and thank the We engaged external advisors to shareholder value.” outgoing chair, Rachel Jafta and alternate provide advice on executive committee member, Cobus Stofberg, remuneration and the committee is Partner with Craig Enenstein for their contributions. satisfied that they are objective and entrepreneurs Chair: Human resources and independent. remuneration committee This year, we have revised our approach in order to demonstrate more clearly Our strategy drives our pay principles the link between Naspers’s strategy, Across our group, we use technology to performance and our remuneration provide new and exciting ways for our Optimise Invest philosophy. This report is designed to customers to be informed, entertained be easier to understand and to ensure and to trade online. As one of the greater transparency regarding how we largest technology investors in the Create Build businesses pay our executives. We are grateful to world, operating in more than 120 sustainable our shareholders for their input, which countries, we focus on high-growth with broad leadership potential was considered carefully. Changes markets and we invest in local, positions include a total view of executive empowered teams with an ownership remuneration, greater transparency mentality. Our business moves fast as on the short-term incentive goals technology trends and consumer of executive directors and more adoption changes, and we seek to run information on how we assess businesses that have broad potential, performance throughout the group. can address big societal needs and can attain market leadership over time. We have incorporated changes to ensure compliance with the King IV™ Our people are at the heart of our guidance, which is effective from 1 April success. Without the driven 2017. In line with King IV™, our 2017/18 entrepreneurs with whom we partner, remuneration report is split into three the digital leaders who drive us forward sections: and the skills our people bring to the group in highly specialised areas such Focus on Address big 1. The background statement: as technology development, product high-growth Grow social needs Provides an overview of pay design, machine learning and artificial markets outcomes for 2017/18 and our intelligence, content rights, digital approach for 2018/19. marketing and many other disciplines, we would not be able to compete as 2. The remuneration policy: effectively as we do. We operate in a Provides information on the highly competitive, global market for components of our executive-pay this type of talent, and we compete packages. against other world-class companies Underpinned by our active capital allocation and strategy. for great people. 3. The implementation report: We ensure we optimise our portfolio for growth and competitiveness. Sets out information on how we Read more on page 26 implemented our policy in 2017/18. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 69

Remuneration report for the year ended 31 March 2018 continued

Our remuneration philosophy 1. Background statement: The Naspers approach to remuneration In practice, this means that we take into account sectoral, regional and local Our remuneration philosophy Our pay principles underpins our group’s strategy and practices as well as the needs of the enables us to achieve our business Five principles guide our remuneration approach. business and the calibre of the individual objectives. Our commitment to pay when implementing our pay framework. for performance and alignment with The Naspers approach to remuneration shareholder value creation drives all our The way we structure pay is purposely remuneration activities, and supports linked to our strategy and to the the ownership mentality and spirit of delivery of long-term sustainable entrepreneurship in our teams around growth to our shareholders. the world. We believe in a level playing We believe in pay for performance; we are comfortable with field for our people. As much as bigger rewards for those that make the highest contribution Our pay principles are applied through possible, the structure of our pay is three key elements and executive pay similar, regardless of the seniority of is heavily weighted towards long-term the employee. performance with a significant proportion delivered in share We endeavour at all times to balance appreciation rights or share options, the need to compete globally for the and with every award subject to very best talent with the need to pay Remuneration must be aligned with shareholder outcomes individual performance. fairly and responsibly. We welcome the opportunity to discuss this policy Our approach to long-term incentives and its outcomes with our stakeholders. ensures that both the value of individual businesses and the overall performance of the group are considered. We are Remuneration must incentivise the achievement of strategic, making significant progress following operational and financial objectives, in both the short and capital investment in several areas, and Craig Enenstein we believe that there is greater strength Chair: Human resources and long term in being one large group, rather than remuneration committee a series of individual companies. The delivery of sustainable value to our 22 June 2018 shareholders will depend on the value of our business units which will ultimately be reflected in the value of We are consistent; our reward package elements are the group as a whole over the longer broadly the same, regardless of seniority* term. Executives only receive payouts under our long-term incentive plans when the value of underlying assets or the Naspers share price increases.

When making executive-pay decisions, Our reward systems must help us attract and retain the best talent we consider the individual’s around the world in a fair and responsible way performance and the performance of the business, the complexity of the responsibilities of the executive, and the growth trajectory and life cycle stage of the business for which he/she * Some hourly-paid employees do not receive long-term incentives. is responsible. 70 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Remuneration report for the year ended 31 March 2018 continued

Our remuneration structure Notes (1) Some LTI schemes associated with underlying We have outlined the three elements of pay for our executive directors below, and the approach is similar for the chief assets in which the group has a minority executive’s direct reports. The same principles are applied to employees across the group. shareholding are not aggregated into the executive director schemes. There is no annual participant liquidity in these schemes. In some Our pay design links to our pay principles limited cases executive directors have received an award directly in those schemes to ensure Pay for Shareholder Attract and that they are incentivised to deliver appropriate returns on invested capital in those businesses. Pay principle performance alignment Incentivisation Consistency retain talent (2) All awards made from September 2017 onwards in Naspers SOs have a four-year-phased vesting (1) Base salary (or • Base salary = fixed pay, with the cost of employers’ taxes and employee benefits in addition. period. Awards made prior to this time have a five-year vesting period with vesting at the end total cost to Note: the fixed pay of employees in South Africa is quoted in terms of TCTC, which of years three, four, and five. company (TCTC)) includes the cost of employers’ taxes and employee benefits. • Personal performance is the primary driver for pay increases. • Set at a level to ensure we can attract and retain talent of the required calibre. • Takes into account regional, local and sector practice as well as an individual’s contribution.

(2) Short-term • We operate an annual incentive plan that pays out depending on performance achieved incentives (STIs): against strategic, operational and financial objectives. Annual • The purpose of the annual incentive plan is to ensure executive alignment with and focus on performance- the annual board-approved business plan. We believe that the achievement of these annual related incentive plans will cumulatively drive long-term shareholder value. or short-term • The same structure is applied throughout the organisation to ensure a consistent incentive approach with measures linked to an individual’s role so that pay is linked to their contribution.

(3a) Long-term • A long-term incentive that pays out based on the growth in value of the business units or incentives an aggregation of underlying assets in a division (eg Ecommerce). (LTIs): Share • Wherever possible, the long-term SAR incentives for executive directors are based on an appreciation aggregation of underlying assets so that any value upside delivered by individual businesses rights (SARs) are offset by any value downside delivered by other businesses, thus ensuring that senior executives are negatively affected should individual businesses not perform(1). • Awards are made to individuals based on their contribution to the business. • Any gains are settled in Naspers shares, which are acquired on the market for cash. • The change in value is measured over a four- or five-year period to ensure focus on the long-term delivery of shareholder value.

(3b) Long-term • Long-term awards made in Naspers’s SOs with payouts based on the growth in Naspers’s incentives share price over a four- or five-year period(2). (LTIs): Naspers • The vesting period has been determined taking into account practice in companies with share which we compete for talent. options (SOs) • Provides long-term alignment with Naspers’s shareholders as value is only delivered to participants if there is an increase in the share price.

The human resources and remuneration committee considers that the remuneration policy continues to achieve its objectives of aligning pay with long-term performance of Naspers and shareholder outcomes. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 71

Remuneration report for the year ended 31 March 2018 continued

Remuneration focus areas and key decisions in 2017/18 Note (1) Ad hoc share-based incentive scheme governance The following table outlines the key areas of focus and key decisions taken by the human resources and remuneration committee during the 2017/18 financial year: matters are dealt with as and when they arise.

Meeting Key areas of focus and decisions(1)

April 2017 • Approval of the directors’ fees for the following financial year: For consideration by the board and subsequent shareholder approval. • Approval of the annual performance incentive KPIs for senior executives for the forthcoming financial year.

June 2017 • Performance and total compensation review of senior executives. • Governance matters: Ethics performance, review of committee’s Decision on previous-year performance and short-term incentive effectiveness in terms of compliance with the committee’s charters payout, salary increases and long-term incentive awards. and review of committee’s compliance with the committee charters • Consideration and approval of the annual long-term share-based of the major subsidiary companies. incentive scheme awards to be made to employees in the Naspers • As part of the King IV™ implementation project: Review of group and long-term share-based incentive scheme limits. committee charters and review of committee charters of the major • Review of SAR scheme valuations completed by Deloitte (report of subsidiary companies. valuations subcommittee) (see page 79 for a detailed description of • Governance matters: Review of the remuneration policy. the valuations process for SAR schemes). • Review of policies required to be reviewed by this committee, including but not limited to, the remuneration policy and board diversity policy.

August 2017 • Market practice update on governance and executive pay.

November 2017 • Shareholder feedback from the remuneration report for the past financial year. • Succession planning for senior executives.

February 2018 • Consideration of recommendation on directors’ fees from external advisors for budget purposes. • Executive remuneration design considerations for the 2019 financial year. 72 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

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Business performance and remuneration outcomes in respect of 2017/18 Notes (1) The normal bonus target is 50% of TCTC. This year there was an additional variable Our strategy • We build businesses with • Partnering with local teams and entrepreneurs bonus capped at 25% of TCTC for obtaining big potential that address societal needs new general funding. • Achieving leadership positions in high-growth markets (2) Fair value: this represents the value of the share option or share appreciation right on grant date.

Our business • Classifieds • Fintech priorities • Video Entertainment • Travel • Food Delivery • B2C Ecommerce

Our financial • Revenue US$20.1bn, up 38% (and 39% in local currency, excluding M&A). • Core headline earnings, the board’s measure of sustainable operating performance, highlights • Trading profit up 51% to US$3.4bn (up 47% and 52% in local currency, excluding M&A). was up 72% on last year at US$2.5bn. • Consolidated development spend down by 17% to US$669m.

Our operating • Ecommerce financial performance • Food Delivery highlights Revenue increased 25% (36%) year on year to US$3.6bn with Classifieds, B2C Solidified food-delivery focus through investments in Delivery Hero and Swiggy. (business-to-consumer), Payments and Food Delivery contributing meaningfully to the • Travel segment’s 9% revenue-growth acceleration on the prior year. MakeMyTrip’s revenue, in local currency and adjusted for the merger with ibibo last • Classifieds year, grew by 21% year on year to US$222m on the back of healthy growth in its airline Excluding the investment to scale letgo, the Classifieds business turned profitable. ticketing, and hotels and packages businesses. • B2C • Video Entertainment eMAG Romania reached profitability. Revenue for the segment increased 8% (7%) to US$3.7bn and trading profit rose 29% • Payments (24%) to US$369m. Recorded a stable performance, adding just over 1m direct-to- Reduced trading loss by 42% on the existing footprint and in local currency. home (DTH) subscribers and 520 000 digital terrestrial television (DTT) subscribers.

Remuneration • 80% STI achievement (CEO). • 83% STI achievement (CFO)(1). outcome • 4% base salary/TCTC increase (CEO/CFO). • LTI award CFO (2) • LTI award CEO(2) Naspers N share options R38m. Naspers N share options R70m. Naspers Global Ecommerce SARs US$2,5m. Naspers Global Ecommerce SARs US$4,8m. • 21% value appreciation Naspers Global Ecommerce Share Appreciation Rights Plan. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 73

Remuneration report for the year ended 31 March 2018 continued

Group financial performance(1) Across our consumer internet The impact of business performance on long-term incentives The performance of the scheme Our principal operations are in internet businesses, we compete against both The following graph shows how the valuation of some of our main long-term was relatively flat when many of our services, where we have interests in local and global ‘tech titans’. Reaching incentive (LTI) schemes has changed over time, reflecting business performance. consumer internet businesses were in listed assets, but predominantly focus scale consumer internet businesses an investment phase. As more on ecommerce (especially online relatively quickly, in terms of consumer businesses reach profitability and scale, classifieds, fintech, food delivery, numbers and markets served, is of value increases and this is reflected in business-to-consumer (B2C) paramount importance in this Value progression of long-term incentive schemes over time the scheme’s performance post 2016. ecommerce and new ventures including environment. It requires significant edtech), video entertainment and investment and often involves incurring (index linked) The video-entertainment share media. 79% (2017: 73%) of our revenue losses in the early years. We make a appreciation rights scheme value reflects now comes from our internet and deliberate choice to invest in these Global ecommerce share appreciation rights value (US$) % Naspers share price (US$) the results of both the MultiChoice ecommerce activities, on an economic- businesses, knowing that short-term Video-entertainment share appreciation rights value (US$) South African and sub-Saharan African interest basis. Consolidated revenue profitability and free cash flow will be businesses. The decline in the value of (excluding equity-accounted negative. As such the financial this scheme is in line with short-term investments) increased 9% (15%), architecture is quite different to some 2.5 expectations and is mostly due to mainly due to strong performances by of our older businesses such as video negative macroeconomic conditions in the ecommerce businesses that grew entertainment or print media. The 2.0 2015 and 2016 with most currencies their consolidated revenues by 15% diversity in our portfolio allows us to devaluing, GDP growth stalling, increased (32%). Performance highlights include: sustain this investment phase. Once competition, and other factors affecting scale is reached, profitability follows. 1.5 consumers. The sub-Saharan Africa • Classifieds: OLX continued to grow business is currently implementing its around the world and turned 1.0 turnaround value strategy that is seeing profitable in the year (excluding letgo). improved operational performance and • Etail: We achieved strong growth subscriber growth. However, it will take Relative growth rebased to 1 to rebased growth Relative across all our etail businesses and 0.5 time for the strategy to have a material eMAG’s Romanian business became positive impact on the financial results profitable. Post year-end we signed an 0 of this segment. The group remains agreement to sell our stake in Flipkart 31 March 2014 31 March 2015 31 March 2016 31 March 2017 31 March 2018 committed to the strategy and in the for US$2.2bn, representing an IRR Annual year-end valuation date medium term, the segment should see of 32%. a positive return to growth. • Travel: MakeMyTrip strengthened its leadership in India. • Payments: PayU enjoyed healthy growth, with TPV exceeding More than 80% of the total compensation of the chief executive is delivered US$25bn, and made key investments through long-term incentives. On page 78, we show all the LTI schemes from in Kreditech and Remitly. which awards have been made historically to the chief executive, CFO and CIO. • Online food delivery: We continued to invest in this promising sector, The Naspers global ecommerce schemes are designed to incentivise employees including a 22% stake in Swiggy and who render services across the internet segment. The global ecommerce scheme 23.75% stake in Delivery Hero. is effectively a sum-of-the-parts of the various underlying assets. In this way the • Video Entertainment: Subscribers participants are exposed to the portfolio of assets as a whole (upside and increased by 1.5m year on year – downside) as opposed to each individual asset in isolation. We believe this drives we now have over 13m subscribers the right behaviour and ensures the focus is the success of the segment as a whole across Africa. Profitability grew 29%. as opposed to an individual asset focus only. • Media24 (excluding Novus) revenues were flat at US$374m and the larger portion of Media24’s investment in Novus was unbundled. Note • Other: We continued to invest in key (1) Where relevant, we have adjusted amounts opportunities such as edtech. and percentages for the effects of foreign currency, as well as acquisitions and disposals. Such adjustments (pro forma information) are quoted in brackets after the equivalent metrics reported under IFRS. 74 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Remuneration report for the year ended 31 March 2018 continued

Executive director remuneration in 2017/18 Value released/vested in long-term incentive schemes in financial year 2017/18(2) Bob van Dijk Basil Sgourdos Mark Sorour(1) Element (US$’000) (US$’000) (US$’000) GUARANTEED Long-term FIXED PAY incentives: share Naspers share options 14 467 933 1 807 Annual appreciation performance- Total Share appreciation rights Base salary/ related incentive rights (SARs) remuneration 9 017 233 322 TCTC and/or share (STI) Notes benefits options (SOs) (1) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director. (2) Fair value on date of grant.

Total remuneration for executive directors for financial year 2017/18 Bob van Dijk Basil Sgourdos Mark Sorour(1) (US$’000) (US$’000) (US$’000)

Element FY17 FY18 FY17 FY18 FY17 FY18

Salary/Total cost to company 1 104 1 332 828 862 682 719

Pension 68 81 78 81 223 223

Benefits 57 65 27 27 10 10

Short-term incentives 973 1 064 443 605(2) 1 718 1 904

Long-term incentive plan(3) 10 403 9 636 1 752 1 954 958 778

Total single figure 12 605 12 178 3 128 3 529 2 633 3 634

Notes (1) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director. (2) Includes an additional variable bonus capped at 25% of TCTC relating to obtaining new general funding. (3) Fair value: represents the value of the option on grant date in accordance with IFRS. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 75

Remuneration report for the year ended 31 March 2018 continued

Implementation of the policy in 2018/19 Implementation of policy in 2018/19 In conclusion Below we show the remuneration package of the executive directors for financial In the past year, acknowledging year 2019 as approved by the human resources and remuneration committee increased focus globally into in June 2018. remuneration practices and disclosures, Short-term incentives (STI) Performance measures we have actively listened to our shareholders’ feedback on pay and, as a Bob van Dijk Basil Sgourdos • Based on financial, operational and result of this, our focus as a committee Fixed pay (US$’000) (US$’000) strategic performance targets Bob Basil will continue to be to ensure that there which are tailored for each role van Dijk Sgourdos is a clear and demonstrable link Salary 1 385 – • Awards paid out in cash between pay and performance. (4% increase) Financial 50% 50%(1) Maximum opportunity We remain committed to maintaining Total cost to company – 1 009 Operational 50% 50% an ongoing dialogue with our (4% increase) • 100% of salary for the chief and strategic executive shareholders and welcome any • 100%(1) of total cost to company feedback that they may have. Design changes for financial year 2019 for the CFO

Note Note Clawbacks (1) An additional variable bonus, capped at (1) An additional variable bonus, capped at 25% of total cost to company relating to 25% of total cost to company relating to From financial year 2019, a two-year clawback provision obtaining new general funding, applies. obtaining new general funding, applies. on STI and LTI will be introduced for the chief executive and his direct reports. Long-term incentives (LTI) Long-term incentives (LTI) Chief executive LTI holding requirement – share appreciation – share options (SOs) From financial year 2019, the chief executive will be required to rights (SARs) maintain a Naspers shareholding of 10 times annual salary. • Based on the total value of the • Based on Naspers’s discrete assets within the total share price Further details can be found on page 90. ecommerce scheme. Any upside • Four- or five-year phased in value created is offset vesting by any downside in the value delivered by individual businesses • Four- or five-year phased vesting

* Total cost to company is fixed pay comprising base salary and non-cash benefits. 76 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Remuneration report for the year ended 31 March 2018 continued

2. Remuneration policy Our remuneration principles Our remuneration and employment Ensuring a fair and responsible Our remuneration structure The group has an integrated and balanced approach to its reward strategy that policies approach to pay We have outlined the three elements of In this section we present the aligns all stakeholder interests, both internal and external. Accordingly, individual Recruitment policy To ensure a fair and reasonable pay for our executive directors below, remuneration policy for our executive reward components are linked to business-specific value drivers of the group. On the appointment of a new approach to the remuneration of and the approach is similar for the chief directors and an overview of the When considering our approach to pay, our overarching principles are as follows: executive director, their package will executive directors in the context of executive’s direct reports. The same groupwide remuneration policy. typically be in line with the policy as the wider group, in practice the principles are applied to employees The Naspers approach to remuneration outlined above. To facilitate committee takes the same approach as across the group, where appropriate. During the 2017/18 financial year, we recruitment, it may be necessary to ‘buy for the wider workforce. carried out a comprehensive shareholder out’ remuneration forfeited on joining Fixed pay consultation exercise to actively listen to We believe in pay for performance; we are comfortable with bigger the company. This will be considered on A number of factors are taken into Base salary/TCTC our shareholders’ views on remuneration. rewards for those that make the highest contribution a case-by-case basis and may comprise account including: • Base salary is the fixed pay that an cash or share options/share employee receives and reflects the One of the consistent themes raised by appreciation rights. • Individual performance. performance and contribution of the our shareholders related to the disclosure • The approach to pay throughout the individual and market value of the of senior executive remuneration and Termination policy organisation. role. The cost of employee benefits how this links to the strategy of the overall Remuneration must be aligned with shareholder outcomes Payments in lieu of notice may be made • Company affordability and trading and employers’ taxes is in addition. group. As a direct response to this, we to executive directors comprised of environment, including return on People are employed in South Africa have significantly increased our disclosure salary or total cost to company (South invested capital. on a TCTC basis, and the cost of on remuneration. African employees) for the unexpired • The total remuneration pay mix for benefits and employers’ tax is portion of the notice period. Such each individual. Remuneration must incentivise the achievement of strategic, included in this figure. Below is a summary of the disclosure payments may be phased. On cessation, • The relative contribution of the job to operational and financial objectives, in both the short and long term • Salary is paid monthly in cash. changes we are implementing for our there is no automatic entitlement to an the overall business success. • Benefits provided include a mix of executive directors for the 2018/19 annual performance-related incentive cash and non-cash benefits, including financial year, together with the (bonus), however the committee Market pay benchmarking is considered pension, medical and other optional associated rationale. retains the discretion to award a bonus an additional reference point. Individual benefits. We are consistent; our reward package elements are to a leaver during the financial year performance is the primary determining • Fixed pay is reviewed annually and any broadly the same* • A clearer link between strategy, taking into account the circumstances of factor in whether to grant a pay increase. increases are typically effective from business performance, remuneration their departure. There is no entitlement Pay increases are not granted in the 1 April each year. design and remuneration outcomes. to a particular severance package absence of a satisfactory level of • A number of factors are taken into • More information on the various provided for in the service contract of performance. Similarly, the operational account during the review process elements of our compensation system Our reward systems must help us attract and retain the best executive director or senior managers. performance of the business and its ability including personal performance, the and in particular how we manage and talent around the world in a fair and responsible way to pay are naturally considered when the scope and nature of the role, relevant assess performance. quantum of any increase is considered. companies in the technology sector • Greater visibility on fixed pay, versus and local economic indicators such as pay at risk. * Some hourly-paid employees do not receive LTIs. Service contracts inflation, cost-of-living changes and the • On our STI, more information on relevant labour market, to ensure the annual performance goals for Executive directors’ service contracts comply with terms and conditions of employment in the local jurisdiction. Details of the date of appointment and remuneration is fair, sensible and executive directors and their level There are many business units within the Naspers group which are at different market competitive. of achievement. levels of maturity. Individual business units are therefore responsible for developing relevant employer notice period are set out in the following table: • On our LTI: their own policies within the overall group remuneration framework according to Variable pay ––greater clarity about the long-term the principles set out above as well as local laws, taking account of regional, local Bob van Dijk Basil Sgourdos Mark Sorour(1) Annual performance-related incentive schemes executive and sector practice. incentive directors participate in Date of appointment 1 August 2013 1 August 1995 1 October 2002 • Participants are eligible to receive ––more information on how we assess The remuneration package of our executive directors is designed to be principally awards under the discretionary annual the valuation of our share appreciation focused on long-term remuneration which only pays out subject to value being Notice period Six months Three months Three months performance-related incentive rights schemes and on the delivered in both the underlying business units and the group as a whole. For scheme to incentivise and recognise governance of the LTI schemes, and example, for the 2017/18 financial year 80% of the chief executive’s remuneration Note the achievement of group financial ––introducing a view of an index-linked was delivered in share options or share appreciation rights. Over time, incentives (1) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director. and operational objectives and progression of the main long-term only deliver value to the chief executive when the value to the shareholder personal performance. incentive schemes, over time. also increases. • The purpose of the annual incentive plan is to ensure executive alignment with and focus on the annual Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 77

Remuneration report for the year ended 31 March 2018 continued

board-approved business plan. The The committee may apply judgement Long-term incentives (LTIs) Share options (SOs) Outline of LTI plans in operation achievement of these annual plans and shall have discretion to make • LTI awards comprise a significant • Awards are made based on the share will cumulatively drive long-term appropriate adjustments to an portion of total compensation and are price on the date of the grant. Share appreciation Share options Restricted stock units shareholder value. individual’s annual bonus to ensure it designed to incentivise the delivery of • SOs deliver value based on the growth rights (SARs) (SOs) (RSUs) • The performance measures for each reflects the underlying financial sustainable long-term growth and in the share price over a specified time executive director are tailored to their performance of the group. provide alignment with our period with vesting typically over a A right to benefit from A right to buy a An award of Naspers roles and responsibilities. Further shareholders. four-year period, with 25% vesting each any increase in value Naspers share at shares that is information is provided in the Target setting: When determining • Awards are normally granted annually year and a term of 10 years. of the business unit a preagreed price transferred to implementation report each year. the targets used for our annual to the executive directors under two • Value is only delivered if there has been over which an award participants after time • For the group chief executive and performance incentive plan, we take into types of LTI schemes: an increase in the share price following is made restrictions have group CFO, at least 50% of maximum account a number of reference points ––share appreciation rights (SARs), and the date of grant. passed bonus opportunity is based on financial including the group internal board- ––share options (SOs). • Once an award vests, participants can Total value of the Total share Total share measures, including and excluding approved business plan and historic • Detailed scheme rules documents then buy company shares at the business price price Tencent (in the case of the CEO). performance. The committee provide for the operation and predetermined strike price and will gain • For the group CIO (retired 31 March undertakes a thorough assessment to governance of each scheme. value from any increase in the price. 2018), given the nature of this ensure that targets are sufficiently deal-based role, more emphasis was stretched in the context of potential Share appreciation rights (SARs) Note that restricted stock units (RSUs) placed on the operational and strategic remuneration delivered. • Awards to executive directors are are not available to the chief executive, objectives and hence a smaller typically made in the Naspers Global CFO, CIO or any direct reports of the Value delivered Value delivered Value delivered weighting (30%) was based on group The performance of executives and Ecommerce SAR Plan, which takes into chief executive, or other senior to participant to participant to participant financial performance. employees against their annual account the performance of a number executives across the group. The Change in value of Change in share price Full value delivered • The annual bonus opportunity for each performance incentive objectives (STI) of internet businesses, In this way any Naspers restricted stock programme is business unit between between grant and vest to the participant executive is agreed annually in advance has significant influence on the decision non-performing business will balance specifically tailored to engineering, grant and vest of the financial year, and any payout is to award long-term incentives. Any share the value created by others, thus specialist and technical talent. The based on targets that are verifiable and options or share appreciation rights that ensuring any gain by the executive inclusion of RSUs in our remuneration • If there is no change • If there is no change • Naspers shares are aligned to the business plan, risk are awarded will only deliver value to the directors adequately reflects total framework ensures that we are or a decrease in value, or a decrease in value, delivered on vesting management policy and strategy. The participant if business performance return on invested capital. Many of the attracting and retaining critical technical there is no gain for there is no gain for target and maximum annual bonus drives an increase in the value of the segment chief executives who report and specialist talent, such as software the participant. the participant. opportunity levels are the same for the asset. to the group chief executive are engineers and those with specialist skills • Gains are settled in • When the option executive directors (ie there is no similarly incentivised in schemes that such as artificial intelligence, machine Naspers shares is exercised the possibility to over-perform against the consider the sum of the value of all of learning, content rights, product design participant becomes a shareholder target) and are set at: There are therefore three personal the businesses for which they are etc, within highly competitive markets. performance requirements (1) ––group chief executive: 100% of base responsible. During FY18 the group purchased on Granted salary associated with a stock option • SARs deliver value based on the market 42 969 (2017: 57 445) Naspers to executive ––group CFO: 50% of total cost to or share appreciation right: growth in the valuation of a group of N ordinary shares at average market directors company (plus an additional variable businesses over a specified time period prices ranging between R2 650.54 and bonus capped at 25% of total cost to • Strong short-term (annual) with vesting typically over a four- to R3 728 per share in respect of grants Granted to company relating to obtaining new performance leading to a decision five-year time period with a term of awarded in the Naspers RSU trust. the wider * to grant a long-term incentive. employee general funding, in financial years typically 10 years. In total 197 132 Naspers N ordinary population where such funding is obtained). In • Ongoing employment which • Any value delivered is based on the shares have been purchased on market permits the incentive to vest over FY19, the maximum for the CFO has change in total value of the business or for this purpose. * Specifically targeted talent, to attract and retain scarce resource at a junior to mid level in their career. been moved to 100%, in line with four to five years. group of businesses. This means that market benchmarks, in addition, as • Superior performance over time, the sum of all decreases/increases in Note leading to value creation in the (1) Some LTI schemes associated with underlying with FY18, a variable bonus capped value is calculated to determine the assets in which the group has a minority at 25% of total cost to company scheme and for the shareholder. final value. shareholding are not aggregated into the relating to obtaining new general • Any payouts are made in an equivalent executive director schemes, as valuation is dependent on the occurrence of a corporate funding applies, and Note: Performance measures and value of Naspers shares. Naspers transaction versus an annual valuation. There is ––group CIO: 200% of total cost to weightings are dealt with in more detail shares are bought on the open market no annual participant liquidity in these schemes. company. in the implementation report. See pages and shareholders are not diluted to In such limited cases executive directors have received an award directly in those schemes to • Any payouts are made wholly in cash. 81 to 91. settle employee SAR gains. ensure that they are incentivised to deliver • Further information on the targets and appropriate returns on invested capital in those payouts are provided each year in the businesses. implementation report. 78 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

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Executive director participation in share schemes The table below sets out details of LTI plans in which the executive directors are currently participate. Since September 2016, awards to the chief executive and CFO have been made in the Naspers Global Ecommerce Share Appreciation Rights Plan and the Naspers Share Option Plan only.

Executive director Type of plan Entity Details Name of plan Comments participating

Share options Naspers group 4-year phased vesting, MIH Services FZ LLC Share Vesting schedule Bob van Dijk N ordinary shares 10-year term Trust(1) amendment approved in Basil Sgourdos 2017

Share options Naspers group 5-year vesting, phased vesting MIH Services FZ LLC Share Legacy Naspers Share Bob van Dijk N ordinary shares in years 3, 4, 5. Trust(1) Option Plan for non-South Basil Sgourdos 10-year term African residents

Share options Naspers group 4-year phased vesting, MIH Holdings Share Trust Vesting schedule Mark Sorour N ordinary shares 10-year term amendment approved in 2017

Share options Naspers group 5-year vesting, phased vesting MIH Holdings Share Trust Legacy Naspers Share Mark Sorour N ordinary shares in years 3, 4, 5. Option Plan for South 10-year term African residents

Share appreciation rights Naspers Ecommerce 5-year phased vesting, Naspers Global Ecommerce Refects main internet Bob van Dijk 10-year term SAR Plan companies in the group Basil Sgourdos Mark Sorour

Share appreciation rights Showmax 5-year phased vesting, Showmax SAR Plan Last granted in September Basil Sgourdos 10-year term 2015 Mark Sorour

Share appreciation rights Flipkart 5-year phased vesting, Flipkart SAR Plan Last granted in August 2016 Bob van Dijk 10-year term Mark Sorour

Share appreciation rights SimilarWeb 5-year phased vesting, SimilarWeb SAR Plan Last granted in September Bob van Dijk 10-year term 2016 Mark Sorour

Share appreciation rights Takealot 5-year phased vesting, Takealot SAR Plan Last granted in August 2016 Mark Sorour 10-year term

Share appreciation rights MIH China/MIH TC 5-year phased vesting, MIH China/MIH TC 2008 Last granted in Mark Sorour (Tencent) 10-year term SAR Plan January 2014

Note (1) The MIH Mauritius N ordinary share option scheme covering the Naspers group was redomiciled to United Arab Emirates and as a result the name was changed. Refer to Annexure A: Details of executive director participation in share schemes. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 79

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Valuing long-term incentives have been made to executive directors We operate SO and SARs plans that in such schemes since September 2016. Valuations process are associated with businesses not publicly listed. We must therefore The chief executive, CFO and CIO perform an annual valuation on these participate in the Naspers Global assets, which ensures we maintain Ecommerce SAR scheme which is a ongoing alignment between value sum-of-the-parts scheme consisting of creation for shareholders and the main entities in ecommerce. The management and employee valuation process is illustrated below Deloitte, independently from remuneration outcomes. and it is indicative of the process for all Naspers provides Deloitte issues Underlying business management, values other schemes. The underlying assets board-approved a report confirming submits 10-year the underlying assets For executives who are responsible for included in the scheme are valued in 10-year business the valuation for each business plan at March 31 annually a number of businesses, it is important accordance with their relevant rules plan for each underlying of the underlying and annual budget and additionally, to incentivise them on the overall and the valuations and governance business to Deloitte operations performance of the assets for which processes are shown below. whenever a significant they are responsible, ensuring that they change occurs are not incorrectly rewarded for Scheme limits success in one part of their portfolio if We place limits on how much of the value is not being created in another. cap table is available for employee We therefore created several ‘umbrella’ compensation. In general, no more (or sum-of-the-parts) schemes than 15% of the capitalisation (cap) encompassing several assets in which table can be used for employee Segment schemes and the ecommerce schemes are a ‘basket of assets’ representing the compensation. Depending on the life the most senior executives participate. valuations of the underlying operations Examples include the Naspers Global stage of the business, the scheme limit Ecommerce SAR scheme, the Naspers can be lower. Global Classifieds SAR scheme and the Naspers Fintech SAR scheme. When the business takes funding from Governance Naspers, the scheme gets diluted as Some LTI schemes associated with additional shares are issued. underlying assets in which the group has a minority shareholding have not been aggregated into the umbrella schemes, as the valuation of these schemes is 1 2 3 4 5 dependent on the occurrence of a corporate transaction versus the annual valuation as performed for the umbrella Report issued Group auditors Review Submission Approval schemes. There is also no liquidity for participants in these schemes until the Deloitte, the PwC, the group The valuations Reports from Deloitte, Once the human occurrence of a liquidity event (and the independent valuer, auditors, audit the subcommittee of PwC and the valuations resources and awards have vested) versus regular issues a report with capitalisation tables, the Naspers human subcommittee are remuneration committee liquidity in the umbrella schemes (once the respective share using the valuations resources and submitted to the approves the valuations the awards have vested). In such limited scheme valuations as input remuneration Naspers human and resultant share prices, cases senior executives have received committee review resources and the share prices will be an award directly in those schemes to the valuations before remuneration updated and participants ensure that they are incentivised to recommending the committee as part of can exercise their share deliver appropriate returns on invested values for approval their approval process options or share capital in those businesses. No awards to the remuneration appreciation rights at committee. The these updated prices in subcommittee consists accordance with the of members of the Naspers trading-in- Naspers board securities policy 80 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

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Non-executive directors’ Non-executive directors’ terms Performance management remuneration policy of appointment at Naspers The fee structure for non-executive The board has clear procedures for Pay for performance is one of the Personal goals are arrived at as an directors has been designed to ensure appointing and orientating directors. pillars of our reward philosophy. outcome of the annual business we attract, retain and appropriately The nomination committee periodically Personal performance (including planning process. As budgets and compensate a diverse and internationally assesses the skills represented on the the financial results of the business) operating plans are designed prior to experienced board of non-executive board and determines whether these is the determining factor in whether the end of the financial year, so too directors, given the highly competitive meet the company’s needs. Annual an individual receives a base salary are the personal performance goals markets in which we operate in, and self-evaluations are done by the board or TCTC increase, an annual at an individual level. These goals, if the global competition we face. and its committees. Directors are performance-related incentive achieved, drive the accomplishment invited to give their input in identifying payout and/or a LTI in the form of the financial and operating plan of Non-executive directors receive an potential candidates. Members of the of SOs or SARs. the business and how it is delivered. annual fee as opposed to a fee per nomination committee propose meeting, which recognises their ongoing suitable candidates for consideration by Our executives are eligible to Managers engage in continuous responsibility for effective control of the board. A fit-and-proper evaluation participate in a performance-related conversations with their people the company. They may also receive is performed for each candidate. STI programme. This is an annual throughout the financial year to an additional fee for group board programme in which participants may ensure that their plans are on track. committees and subsidiary boards, Retirement and re-election receive annual performance-related At the end of the financial year both to reflect the additional responsibilities of directors incentive payments if they achieve the overall performance of the and associated time commitment. All non-executive directors are subject certain preapproved business and business, and the individual’s Remuneration is reviewed annually, to retirement and re-election by personal goals. Similarly, mostly annual, achievement of their personal and is not linked to the company’s share shareholders every three years. STI programmes are operated across goals are considered and this price or performance. Non-executive Additionally, non-executive directors the group. may translate into the payment of an directors do not qualify for share are subject to election by shareholders annual performance-related incentive. allocations under the group’s incentive at the first suitable opportunity for Performance goals are directly aligned While we do not force-rank schemes. interim appointments. The names of with the approved business plans. In performance scores, we do expect non-executive directors submitted for the case of the chief executive, his that any performance-related The remuneration of non-executive election or re-election are accompanied annual performance-related incentive incentive payments reflect the overall directors is determined following a by brief biographical details to enable goals are exactly as per the Naspers performance of the business where benchmarking exercise which considers shareholders to make an informed board-approved annual business plan. appropriate. Individuals who have not only JSE-listed companies, but, given decision on their election. The The annual goals of functional and performed well against their the relative size, scale and complexity reappointment of non-executive business segment leaders reporting to performance-related incentive goals, of the group’s activities, also considers directors is not automatic. the chief executive will similarly be are eligible to be considered for a international comparators in the media, based on financial and personal LTI grant and a pay increase. Only video-entertainment and consumer For the full remuneration policy, go to objectives, tailored to their specific strong performers are considered internet sectors. www.naspers.com. areas of responsibility and impact. for LTI awards. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 81

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3. Implementation of remuneration policy Below we show the relative weightings of each type of compensation: Base salary/ TCTC, STI and LTIs for each executive as at 31 March 2018. In this section we outline how our remuneration policy for executive directors has been implemented during this financial year and how we intend to operate it during the next financial year. All decisions in relation to executive remuneration have been made in line with our remuneration policy for this financial year. BOB VAN DIJK BASIL SGOURDOS Executive directors’ total remuneration for the financial year to 31 March 2018 Guaranteed Actual annual Fair value LTI fixed pay bonus Total awarded (US$’000)(1) (US$’000)(2) (US$’000) (US$’000)(3)

Bob van Dijk 2018 1 332 1 064 2 396 9 636

2017 1 104 973 2 077 10 403

Basil Sgourdos 2018 862 605 1 467 1 954

2017 828 443 1 271 1 752

(4) Mark Sorour 2018 719 1 904 2 623 778 % % 2017 682 1 718 2 400 958 ANNUAL FIXED PAY 11. 07 ANNUAL FIXED PAY 25.19 ANNUAL STI (TARGET) 8.84 ANNUAL STI (TARGET) 17.68 Notes ANNUAL FAIR-VALUE LTI 80.08 ANNUAL FAIR-VALUE LTI 57.11 (1) Guaranteed fixed pay for 2018 comprises base salary levels of US$1 332 000 for Bob van Dijk with the remainder attributing to pension and other benefits, eg medical insurance. For Basil Sgourdos and Mark Sorour this comprises total TCTC of US$970 000 and US$952 000 respectively, which incorporates base salary and any benefits. (2) Annual bonus levels paid out in respect of each financial year. MARK SOROUR (3) The fair value of LTIs awarded during each financial year. Details of the separate awards can be found in the shareholding table on page 83. (4) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director and remains on the Mail.ru Group board. To provide management with the option of obtaining his advice on critical transactions, a consultancy contract was concluded with Mark.

% ANNUAL FIXED PAY 21.14 ANNUAL STI (TARGET) 55.98 ANNUAL FAIR-VALUE LTI 22.87 82 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

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Guaranteed fixed pay (TCTC) Annual performance incentive: Achievement against financial goals Strategic and operational Mark Sorour – annual performance During the year, levels of base salary and In the following tables we outline the actual outcomes for each financial performance measure relative to the target set at the performance measures for Bob van incentive: The short-term incentive TCTC (where relevant) continued to beginning of the financial year, together with the resulting payout. Dijk (chief executive) accounted for for Mark Sorour was based on group vary across the jurisdictions where we 50% of his total bonus opportunity. financial goals (as per those for the chief operate. In determining any increases Bonus target Bonus achieved These related to classifieds, payments, executive and CFO) with a weighting of for executive directors we considered food delivery, travel, B2C ecommerce 30%. 70% of the short-term incentive personal performance, business Bob van Basil Mark Bob Basil Mark and video entertainment. Financial for the chief investment officer relates performance and local economic Dijk Sgourdos Sorour van Dijk Sgourdos Sorour measurements included topline growth to M&A deals. The nature of these indicators, overall movement in the (eg gross merchandise volume (GMV)), goals is naturally confidential but the local (and, where appropriate, regional Financial Bonus % of base % of base revenue growth, trading profit growth typical incentives relate to the price and global) labour market, and levels measure Actual impact salary % TCTC salary % TCTC (or trading loss reduction). Operational and mechanics of the deal. observed across the wider workforce. measurements included growth in the During the year, group companies made Revenue US$20.1bn Achieved 10 – – 10 – – number of customers, relative Outcomes: The outcomes above contributions for executive directors to competitive position and new product resulted in annual bonus payout levels the appropriate pension schemes. and/or new market development. of 80% base salary for Bob van Dijk These contributions are in line with and 62% and 200% of TCTC for Basil market norms and constitute a modest Free cash US$242m Achieved 10 25 25 10 25 25 Strategic and operational Sgourdos and Mark Sorour respectively. proportion of the individuals’ total outfow performance measures for remuneration. Basil Sgourdos (CFO) accounted Long-term incentives costs for 50% of his total bonus opportunity As a committee, we have endeavoured Annual incentive payout in respect and related to the management of the to be more transparent on the of the 2017/18 financial year finance function, with an emphasis disclosure of the awards made, and Core headline US$2 507m Achieved 15 25 25 15 25 25 on tax, treasury, investor relations, those outstanding under our long-term During the financial year, the bonus earnings awards were subject to a combination governance and control, and incentive scheme. of financial, operational and strategic finance talent. performance measures. The target and Share-based compensation incentives maximum achievement levels are one across the group account for 8.7% of and the same (ie there is no Core headline (US$781m) Achieved 15 – – 15 – – total staff costs, and 1.8% of overall opportunity to overachieve on bonus earnings group costs, for example the cost of payout) and were: (excluding providing services and sale of goods; Tencent) selling, general and administration Bob van Dijk: 100% of base salary expenses. Further details can be found on pages 140 to 151 of the Basil Sgourdos: 50% of TCTC (plus full annual financial statements on an additional variable bonus capped www.naspers.com. In addition to the above, each executive director was also subject to strategic and operational performance measures. at 25% of TCTC relating to obtaining new general funding, in financial years Given the nature of our businesses, where such funding is obtained) we operate a number of incentive plans for our executive directors to ensure Mark Sorour: 200% of TCTC they are incentivised across the whole portfolio. A full statement of the The weightings of each performance holdings of the executive directors measure varied for each executive can be found on pages 88, 90 and 91. director, subject to their key priorities during the year. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 83

Remuneration report for the year ended 31 March 2018 continued

Plan participation Value of historical long-term incentive grants to executive directors Schemes in which executive directors were awarded LTIs in FY18: Due to the pace of change in our industry and the evolution of key priorities each year, the award levels for each executive director vary from year to year. To reflect this, we have provided a summary below of the awards made to each executive director over the past three years. Active LTI plans Entity Details Award made to Bob van Dijk Basil Sgourdos Mark Sorour (US$’000) (US$’000) (US$’000) SARs Naspers Naspers 5-year annual Bob van Dijk (1) (1) (1) (1) (1) (1) Global phased vesting Basil Sgourdos Face value Fair value Face value Fair value Face value Fair value Ecommerce Mark Sorour Valuation based FY16 0 0 2 053 848 3 074 1 308 on the underlying (0% Naspers shares, (51% Naspers (51% Naspers assets 0% SARs) shares, 49% SARs) shares, 49% SARs)

SOs Naspers 4-year phased Bob van Dijk N ordinary vesting Basil Sgourdos shares Mark Sorour FY17 21 630 10 403 4 970 1 752 2 473 958 (100% Naspers (33% Naspers (53% Naspers Details of the group’s share-based incentive schemes are disclosed in note 43 on shares) shares, 67% SARs) shares, 47% SARs) pages 140 to 142 of the annual financial statements on www.naspers.com.

FY18 36 290 9 636 7 634 1 954 2 494 778 (32% Naspers (17% Naspers (100% Naspers shares, 68% SARs) shares, 83% SARs) shares)

Note (1) Grant date face value/fair value for awards.

As per King IV™ guidelines, we set out the fair value for all awards made in the year and all of those awards that are outstanding. 84 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Remuneration report for the year ended 31 March 2018 continued

Awards released during the period Naspers N options Share appreciation rights 1 April 2017 to 31 March 2018 During the year a number of share Number options and share appreciation rights Release value of share were released (vested) to executive Number of at release date Face value at Fair value at appreciation directors and these are outlined in options (R) grant date (R) grant date (R) Scheme name rights Release value Face value Fair value the adjacent table. Bob van Dijk 277 333 813 120 943 319 735 321 151 090 876 Flipkart SAR Plan 73 170 US$4 656 539 US$4 656 539 US$1 685 025

6 698 17 314 330 5 143 348 2 126 188 SimilarWeb SAR Plan 39 937 US$225 644 US$57 909 US$19 188

Naspers Global Ecommerce SAR Plan 1 493 226 US$41 287 699 US$23 264 461 US$7 312 840

Basil Sgourdos 11 124 28 940 310 4 835 861 1 869 837 Naspers Global Ecommerce SAR Plan 9 682 US$267 707 US$179 988 US$53 810

7 469 21 625 593 10 297 310 4 441 337 Naspers Global Ecommerce SAR Plan 32 599 US$896 798 US$666 650 US$170 017

9 120 23 575 200 7 003 186 2 895 019 Showmax SAR Plan 1 111 US$19 998 US$19 998 US$9 621

Mark Sorour(1) 10 000 29 319 300 11 528 933 5 280 064 MIH China/MIH TC 2008 SAR Plan 8 000 US$1 447 280 US$343 590 US$89 413

9 337 27 034 163 12 872 672 5 307 703 Flipkart SAR Plan 617 US$39 266 US$39 266 US$14 209

13 680 35 362 800 10 504 780 4 203 648 Flipkart SAR Plan 942 US$59 949 US$59 949 US$20 704

18 539 48 231 248 8 059 335 3 206 296 Flipkart SAR Plan 841 US$53 521 US$53 521 US$12 834

13 680 35 362 800 10 504 780 4 203 648 SimilarWeb SAR Plan 344 US$1 944 US$499 US$165

18 539 48 231 248 8 059 335 3 206 296 SimilarWeb SAR Plan 1 497 US$8 458 US$10 000 US$3 927

SimilarWeb SAR Plan 1 336 US$7 548 US$8 924 US$4 301

Naspers Global Ecommerce SAR Plan 13 493 US$373 081 US$210 221 US$66 080

Naspers Global Ecommerce SAR Plan 8 606 US$237 956 US$159 985 US$47 830

Naspers Global Ecommerce SAR Plan 6 985 US$192 157 US$142 843 US$36 430

Takealot SAR Plan 1 094 R97 847 R121 478 R52 179

Takealot SAR Plan 925 R82 732 R121 129 R38 779

Showmax SAR Plan 2 222 US$39 996 US$39 996 US$19 242

Note (1) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 85

Remuneration report for the year ended 31 March 2018 continued

Awards made during the period 1 April 2017 to 31 March 2018 Executive directors’ relative shareholding by scheme (fair value) Value of unvested equity grants by scheme after FY18 grant Naspers N share options Share appreciation rights

Number BOB VAN DIJK BASIL SGOURDOS of share Unvested equity mix after FY18 grant Unvested equity mix after FY18 grant Number of Face value(1) Fair value appreciation Face value Fair value (fair value) (fair value) options (R) (R) Scheme name rights (US$) (US$)

Bob van 51 728 148 031 569 44 959 480 Naspers Global 733 945 20 000 001 4 980 814 Dijk Ecommerce SAR Plan

Naspers Global 175 259 4 837 148 1 176 485 Ecommerce SAR Plan

Basil 5 776 16 529 352 5 020 220 Naspers Global 126 766 3 454 374 860 281 Sgourdos Ecommerce SAR Plan % % Naspers Global 105 088 2 900 429 705 439 FLIPKART SAR PLAN 7 MIH SERVICES FZ LLC Ecommerce SAR Plan MIH SERVICES FZ LLC (Naspers shares) 53 Mark 11 049 32 549 139 10 151 905 (Naspers shares) 53 NASPERS GLOBAL ECOMMERCE SAR PLAN Sorour(2) NASPERS GLOBAL ECOMMERCE 47 SAR PLAN 40 SHOWMAX SAR PLAN 1 Notes SIMILARWEB SAR PLAN 0.1 (1) Grant date face/fair value for awards. (2) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director. MARK SOROUR Mark Sorour has not received a grant in the underlying schemes since Unvested equity mix after FY18 grant August 2017. (fair value)

% FLIPKART SAR PLAN 3 MIH CHINA/MIH TC 2008 SAR PLAN 3 MIH HOLDINGS SHARE TRUST (Naspers shares) 76 NASPERS GLOBAL ECOMMERCE SAR PLAN 9 SHOWMAX SAR PLAN 1 SIMILARWEB SAR PLAN 1 TAKEALOT SAR PLAN 7 86 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Remuneration report for the year ended 31 March 2018 continued

Gains made on any options or SARs exercised during the period 1 April 2017 to 31 March 2018 Note (1) Mr Sorour exercised share appreciation rights in Naspers – N share options Share appreciation rights a group share-based incentive plan and received 5 833 Naspers N ordinary shares in settlement of the gain. He then sold 5 833 Naspers N Date Number Date ordinary shares. exercised of options Strike price Exercise price Gross gain exercised Scheme Strike price Exercise price

Bob van Dijk – – – – – – – – –

Basil Sgourdos – – – – – – – – –

Mark Sorour 03/07/2017 13 680 R770.00 R2 600.00 to R2 601.61 R35 575 136

19/07/20171 5 833 R2 768.27 to R2 775.01 R16 178 111 19/07/2017(1) MIH China/MIH TC 2008 SAR Plan US$42.95 U S $116 . 29

Dilutive impact of group 40 588 541 Naspers N ordinary shares 31 March 2018 31 March 2019 share-based incentive schemes (some 10% of Naspers’s N ordinary share capital at 31 March 2010) may be Board From 1 April 2018, the issued for the group’s share-based incentive schemes. During the financial Chair US$452 000 US$474 600 group will purchase year to 31 March 2018, 390 806 new Naspers shares on the N ordinary shares had been so issued, Member US$180 800 US$189 840 JSE for the purpose of resulting in a total of 30.10% of the approved 40 588 541 Naspers N Daily fees when travelling to and attending meetings outside US$3 500 US$3 500 issuing new Naspers share ordinary share capital being used home country options to employees and to date. Committees settling gains made on all Non-executive directors’ fees share-based incentive The committee is informed by the Audit committee Chair US$111 350 US$116 925 schemes. external market when reviewing the fee structure and levels for our Member US$44 540 US$46 770 non-executive directors. This includes The group’s share-based incentive market fee levels for Naspers’s industry Risk committee Chair US$66 150 US$69 450 schemes are set out in equity peers internationally, such as compensation benefits in the notes competitors in the same industry and Member US$26 460 US$27 780 to the annual financial statements on of similar scale and those fee levels www.naspers.com . At 31 March observed in the Top 10 JSE companies. Human resources and remuneration committee Chair US$78 250 US$82 163 2018 the group held 3 097 876 (2017: 3 293 211) Naspers N ordinary The current non-executive director fee Member US$31 300 US$32 865 shares as treasury shares to settle structure and levels, which reflect a 5% outstanding options under certain year-on-year increase, were approved Nomination committee Chair US$42 175 US$44 275 group share incentive schemes. by shareholders at the annual general meeting in August 2017. Member US$16 870 US$17 710 The expected dilutive effect of these treasury shares on the group’s earnings, Social and ethics committee Chair US$57 875 US$60 775 on a per-share basis, was 8 US cents per N ordinary share (2017: 2 US cent). In accordance with schedule 14 of the Member US$23 150 US$24 310 JSE Listings Requirements and the Other South African Companies Act, at the annual general meeting in August 2011 shareholders approved that up to Trustee of group share schemes/other personal funds R48 720 R51 200 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 87

Remuneration report for the year ended 31 March 2018 continued

Non-executive directors’ fees continued 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.

2018 2017

Directors’ fees(1) Committee(2) and trustee(3) fees Other fees(4) Directors’ fees(1) Committee(2) and trustee(3) fees Other fees(4)

Paid by Paid by Paid by Paid by Paid by Paid by Total Paid by Paid by Paid by Paid by Paid by Paid by Total Non-executive company subsidiary company subsidiary company subsidiary 2018 company subsidiary company subsidiary company subsidiary 2017 directors US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000

J P Bekker 526 23 – – – – 549 504 20 – – – – 524

E M Choi 258 – 28 – – – 286 – – – – – – –

H J du Toit – – – – – – – – – – – – – –

C L Enenstein 258 – 10 – – 50 318 246 – – – – 50 296

D G Eriksson 233 53 235 52 – – 573 218 47 224 36 – – 525

R C C Jafta 233 70 199 10 – – 512 218 61 180 26 – – 485

F L N Letele 233 – 23 – – 433 689 218 – 22 – – 275 515

G Liu 258 – – – – – 258 232 – – – – – 232

D Meyer 233 23 23 13 – – 292 218 20 22 12 – – 272

R Oliveira 261 – 5 – – 50 316 232 – – – – 50 282 de Lima

S J Z Pacak 251 35 26 17 – 47 376 246 31 25 14 – 187 503

T M F Phaswana 233 – 48 – – – 281 242 – 46 – – – 288

J D T Stofberg 251 – 0 – – – 251 221 – – – – – 221

B J van der Ross 230 – 71 – – – 301 218 – 68 – – – 286

Total 3 458 204 668 92 – 580 5 002 3 013 179 587 88 – 562 4 429

Notes General notes (1) Koos Bekker elected to donate the full after-tax Directors’ fees include fees for services as directors, where appropriate, of proceeds of his Naspers director’s fees, being Media24 Proprietary Limited, MultiChoice South Africa Holdings Proprietary R3.4m, to Simondium Primary, a school serving Limited and NMS Insurance Services Limited. An additional fee may be paid mostly farmworkers’ children in the Drakenstein to directors for work done as directors with specific expertise. Valley of South Africa. (2) Appointed 21 April 2017. Committee fees include fees for attending meetings of the audit committee, (3) Hendrik du Toit elected not to receive director’s risk committee, human resources and remuneration committee, nominations fees. committee and social and ethics committee. Committee and trustee fees include, (4) Compensation for assignments. where appropriate, fees to be considered by shareholders at the annual general meeting on 24 August 2018 for services as trustees of the group share-based schemes. Non-executive directors are subject to regulations on appointment and rotation in terms of the company’s memorandum of incorporation and the South African Companies Act. 88 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Remuneration report for the year ended 31 March 2018 continued

The committee conducts an annual Directors’ interest in Naspers shares General note Koos Bekker and Cobus Stofberg each have an indirect 25% interest in benchmarking exercise to ascertain The directors of Naspers have the following interests in Naspers A ordinary shares on 31 March: Wheatfields 221 Proprietary Limited, which controls 168 605 Naspers Beleggings whether the fees for non-executive (RF) Beperk ordinary shares, 16 860 500 Keeromstraat 30 Beleggings (RF) directors are competitive, fair and 31 March 2018 31 March 2017 Beperk ordinary shares and 169 865 Naspers A shares. No other director of reasonable. Fees are not only Naspers had any direct interest in Naspers A ordinary shares at 31 March 2018 Naspers A ordinary shares Naspers A ordinary shares or 31 March 2017. benchmarked against JSE-listed companies but also against international Beneficial Beneficial publicly listed companies operating in the consumer internet sector. Given Name Direct Indirect Total Direct Indirect Total the global scale and complexity of the businesses which the group operates J D T Stofberg – 166 166 – 166 166 and has interest in, it is important that we can attract and retain the best The directors of Naspers (and their associates) had the following interests in Naspers N ordinary shares as at 31 March: Notes globally orientated board members. (1) Appointed 21 April 2017. 31 March 2018 31 March 2017 (2) On 8 February 2018 Nolo Letele purchased 737 Naspers N ordinary shares upon payment of the amount of R100 794.54 to the MIH Holdings Share Non-executive directors do not receive Naspers N ordinary shares Naspers N ordinary shares Trust. any long-term or equity-based (3) On 10 July 2017 Steve Pacak’s family trust sold 15 000 Naspers N ordinary Beneficial Beneficial shares at average market prices ranging between R2 523.00 and R2 529.37 compensation. per share. On 7 February 2018 Steve’s family trust sold 185 000 Naspers N ordinary shares at average market prices ranging between R3 012.86 and Termination payments Name Direct Indirect Total Direct Indirect Total R3 077.24 per share in the MIH Services FZ LLC Share Trust. On 7 February 2018, 300 000 Naspers N ordinary shares were delivered to Steve’s family No termination payments were made J P Bekker – 4 688 691 4 688 691 – 4 688 691 4 688 691 trust upon payment of the amount of R41 028 950.84 to MIH Services FZ to executive and non-executive LLC Share Trust from the proceeds of the sale of the 185 000 Naspers N directors on termination of E M Choi(1) – – – – – – ordinary shares. On 7 September 2017, 18 000 N ordinary shares held in the MIH Services FZ LLC Share Trust vested. employment or office in FY18. (4) The comparative has been restated to correct the allocation between direct H J du Toit – – – – – – and indirect holding. The total number of shares held, remains unchanged. Compliance (5) On 13 March 2018 Mark Sorour’s spouse sold 43 Naspers N ordinary shares C L Enenstein – – – – – – There were no deviations from the at a market price of R3 566.00 per share. (6) Retired as an executive director on 31 March 2018. Mark remained on the remuneration policy in FY18. D G Eriksson – – – – – – board as a non-executive director. (7) On 15 December 2017 Ben van der Ross’s family trust purchased 420 R C C Jafta – – – – – – Naspers N ordinary shares at a market price of R3 395.00 per share. On 16 January 2018 Ben purchased 1 650 Naspers N ordinary shares F L N Letele(2) 1 474 – 1 474 737 – 737 at average market prices ranging between R3 653.76 and R3 679.19 per share. (8) Naspers share options that have been released (vested), but have not yet G Liu – – – – – – been exercised, are included in the indirect column: D Meyer – – – – – – Number of released/ Number of released/ vested options vested options R Oliveira de Lima – – – – – – FY18 FY17 S J Z Pacak 254 000 236 000 (3),(4),(8) S J Z Pacak 376 635 291 548 668 183 312 635 537 548 850 183 V Sgourdos 86 990 59 277 T M F Phaswana – 3 530 3 530 – 3 530 3 530 B van Dijk 568 062 284 031 V Sgourdos(8) – 86 990 86 990 – 59 277 59 277

M R Sorour(5),(6),(8) 1 219 61 556 62 775 1 262 23 680 24 942 There have been no further changes to the directors’ interests between the end of the financial year and 22 June 2018. J D T Stofberg 159 831 291 888 451 719 159 831 291 888 451 719 B J van der Ross(7) 1 650 820 2 470 – 400 400 B van Dijk(8) – 568 062 568 062 – 284 031 284 031 Total 540 809 5 993 085 6 533 894 474 465 5 889 045 6 363 510 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 89

Remuneration report for the year ended 31 March 2018 continued

Implementation of policy in the 2018/19 financial year Short-term incentives FY19 short-term incentive (STI) Short-term incentives: Strategic We have provided details below on the proposed operation of our policy for Awards will be made in line with our scheme structure and operational goals 2018/19 financial year. revised remuneration policy. Strategic and operational goals BOB VAN DIJK account for 50% of the short-term, Base salary Clawback: From FY19, short-term performance-related incentive for The table below presents the base salary levels implemented for FY19. incentive plans for Bob van Dijk, the chief executive and the CFO. Basil Sgourdos and all other executive direct reports of Bob van Dijk will For Bob van Dijk (chief executive) these Base salary Base salary 1 April 2018 1 April 2019 include a clawback provision. goals relate to the performance of the US$’000 US$’000 % change business segments including Classifieds, The clawback provision will operate Maximum STI opportunity: Payments, B2C Ecommerce, Food Bob van Dijk 1 332 1 385 4% for two years following the payment 100% base salary Delivery and Video Entertainment. of an STI or LTI and will give the Measurements include financial metrics (1) remuneration committee the ability to such as revenue growth and trading Basil Sgourdos 970 1 009 4% FINANCIAL GOALS: claw back all or part of the incentive % profit (or trading loss reduction in paid in a particular financial year in the REVENUE 10 earlier-stage businesses). Other Note (1) Includes pension and other benefits. event of material financial misstatement CORE HEADLINE EARNINGS performance metrics related to the or gross misconduct on the part of (INCLUDING TENCENT) 15 business segments include new product, the individual. CORE HEADLINE EARNINGS technology or market development, (EXCLUDING TENCENT) 15 the relative competitive position of We have provided information on the the business and key customer metrics performance measures to be used for FREE CASH FLOW 10 such as growth in customer numbers. the 2018/19 financial year. STRATEGIC GOALS: OPERATIONAL/STRATEGIC For Basil Sgourdos, these goals relate Short-term incentives: Financial goals 50 to the effective management of the group’s Group financial goals account for 50% finance function including goals related of the short-term, performance-related to tax, treasury, stakeholder management incentive of the chief executive and BASIL SGOURDOS and governance and controls. CFO. The group financial goals for Basil Sgourdos have been adjusted compared to FY18 so that core headline earnings including and excluding Tencent are considered.

Measurements for both individuals Maximum STI opportunity: include core headline earnings including 100% base salary(1) Tencent, core headline earnings excluding Tencent, and free cash flow. FINANCIAL GOALS: % In addition, the chief executive is measured on revenue growth for CORE HEADLINE EARNINGS the group. (INCLUDING TENCENT) 12.5 CORE HEADLINE EARNINGS (EXCLUDING TENCENT) 12.5 FREE CASH FLOW 25

STRATEGIC GOALS: OPERATIONAL/STRATEGIC 50

Note (1) An additional variable bonus capped at 25% of TCTC relating to obtaining new general funding, applies. 90 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Remuneration report for the year ended 31 March 2018 continued

Long-term incentives Annexure A We have set out below information on the long-term awards to be made during the 2018/19 financial year. A summary of executive directors’ participation in Naspers scheme shares, in relation to shares outstanding (not yet released/vested) at 31 March 2018, is set out below. Naspers Global Ecommerce MIH Services FZ LLC Share Trust (Naspers share options) Naspers N share options Share Appreciation Rights Number of Number N ordinary Face value Fair value of share Name Offer date shares per share (R) Release period per share (R)(1) Number Face value Fair value appreciation Face value Fair value Name of options (R) (R) rights (US$) (US$) Bob van Dijk 11/07/ 2013 6 698 767.89 11/07/ 2018 344.19

Bob van Dijk 61 142 196 082 394 70 034 630 418 434 14 046 829 4 855 147 28/03/2014 277 334 1 152.89 28/03/2019 581.04 Basil Sgourdos 33 108 106 177 356 37 923 010 214 759 7 209 460 2 491 881 05/07/2016 147 906 2 162.89 05/07/2019 to 05/07/2021 841.96 – 1 040.60

Post this allocation and as at 31 March 2019 the fair value of Bob van Dijk’s and Basil Sgourdos’s 08/09/2017 51 728 2 861.73 08/09/2018 to 08/09/2021 638.05 – 1 083.79 share-based incentives will be balanced approximately as follows: Basil Sgourdos 11/07/ 2013 9 120 767.89 11/07/ 2018 344.19

04/09/2014 14 940 1 378.67 04/09/2018 to 04/09/2019 648.05 – 695.10

18/9/2015 6 741 1 740.85 18/09/2018 to 18/09/2020 765.98 – 914.29

25/9/2015 1 378 1 700.53 25/09/2018 to 25/09/2020 748.89 – 894.66

29/08/2016 9 691 2 429.53 29/08/2019 to 29/08/2021 909.76 – 1 135.31

08/09/2017 5 776 2 861.73 08/09/2018 to 08/09/2021 638.05 – 1 083.79 % Note BASED ON THE PERFORMANCE (1) The value of the option represents the fair value on grant date in accordance with IFRS. OF THE ECOMMERCE SEGMENT SPECIFICALLY 50 MIH Holdings Share Trust (Naspers share options) BASED ON THE PERFORMANCE Number of OF NASPERS AS A WHOLE 50 N ordinary Face value Fair value Name Offer date shares per share (R) Release period per share (R)(1) Clawback provision on LTI From FY19, a clawback provision will be in operation on any LTI grants made to the executive Mark Sorour(2) 11/07/ 2013 13 680 767.89 11/07/ 2018 333.60 directors and the other direct reports of the chief executive. The provision will be in operation for two years after the award has been made. 28/03/2014 10 000 1 152.89 28/03/2019 567.40 Naspers shareholding requirement 04/09/2014 18 674 1 378.67 04/09/2018 to 04/09/2019 626.11 – 676.96 From FY19, the chief executive will be required to hold Naspers shares to the value of 10 times his annual salary. The human resources and remuneration committee confirms that the chief executive 18/09/2015 10 111 1 740.85 18/09/2018 to 18/09/2020 765.98 – 914.29 has met the required shareholding threshold for FY19. 25/09/2015 2 067 1 700.53 25/09/2018 to 25/09/2020 748.89 – 894.66

29/08/2016 7 787 2 429.53 29/08/2019 to 29/08/2021 909.76 – 1 135.31

28/08/2017 11 049 2 945.89 28/08/2018 to 28/08/2021 673.40 – 1 144.64 Notes (1) The value of the option represents the fair value on grant date in accordance with IFRS. (2) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 91

Remuneration report for the year ended 31 March 2018 continued

Directors’ interests in other group Name Incentive scheme Offer date Number of SARs Purchase price per SARs Release period Fair value per SARs(1) share-based incentive schemes A summary of executive directors’ Bob van Dijk Flipkart SAR 10/09/2014 146 344 US$63.64 10/09/2018 to 10/09/2019 US$24.63 – US$26.04 participation in other Naspers group share-based incentive schemes in Naspers Global Ecommerce SAR 12/09/2014 2 986 455 US$15.58 12/09/2018 to 12/09/2019 US$5.26 – US$5.59 relation to shares/appreciation rights not yet released at 31 March 2018, Naspers Global Ecommerce SAR 15/08/2017 733 945 US$27.25 15/08/2018 to 15/08/2022 US$5.52 – US$7.91 is set out in the adjacent table. Full details can be found in note 43 Naspers Global Ecommerce SAR 08/09/2017 175 259 US$27.60 08/09/2018 to 08/09/2022 US$5.51 – US$7.80 on pages 140 to 151 of the consolidated annual financial statements at SimilarWeb SAR 10/09/2014 79 874 US$1.45 10/09/2018 to 10/09/2019 US$0.52 – US$0.55 www.naspers.com. Basil Sgourdos Naspers Global Ecommerce SAR 17/09/2015 29 049 US$18.59 17/09/2018 to 17/09/2020 US$6.04 – US$6.84

Naspers Global Ecommerce SAR 29/08/2016 130 400 US$20.45 29/08/2018 to 29/08/2021 US$5.78 – US$7.07

Naspers Global Ecommerce SAR 15/08/2017 126 766 US$27.25 15/08/2018 to 15/08/2022 US$5.52 – US$7.91

Naspers Global Ecommerce SAR 08/09/2017 105 088 US$27.60 08/09/2018 to 08/09/2022 US$5.51 – US$7.80

Showmax SAR Plan 18/09/2015 3 334 US$18 18/09/2018 to 18/09/2020 US$9.30 – US$10.28

Mark Sorour(2) Flipkart SAR Plan 10/09/2014 1 235 US$63.64 10/09/2018 to 10/09/2019 US$24.63 – US$26.04

Flipkart SAR Plan 11/0 9/ 2015 2 830 US$63.64 11/09/2018 to 11/09/2020 US$23.80 – US$26.75

Flipkart SAR Plan 30/08/2016 3 368 US$63.64 30/08/2018 to 30/08/2021 US$17.01 – US$20.90

Naspers Global Ecommerce SAR 12/09/2014 26 987 US$15.58 12/09/2018 to 12/09/2019 US$5.26 – US$5.59

Naspers Global Ecommerce SAR 17/09/2015 25 822 US$18.59 17/09/2018 to 17/09/2020 US$6.04 – US$6.84

Naspers Global Ecommerce SAR 29/08/2016 27 943 US$20.45 29/08/2018 to 29/08/2021 US$5.78 – US$7.07

MIH China/MIH TC 2008 SAR 17/01/2014 8 000 US$42.95 17/01/2019 U S $11. 54

SimilarWeb SAR 10/09/2014 692 US$1.45 10/09/2018 to 10/09/2019 US$0.52 – US$0.55

SimilarWeb SAR 17/09/2015 4 491 US$6.68 17/09/2018 to 17/09/2020 US$2.83 – US$3.16

SimilarWeb SAR 02/09/2016 5 348 US$6.68 02/09/2018 to 02/09/2021 US$3.53 – US$4.15

Showmax SAR 18/09/2015 6 667 US$18 18/09/2018 to 18/09/2020 US$9.30 – US$10.28

Takealot SAR 11/0 9/ 2015 3 282 R111. 0 4 11/09/2018 to 11/09/2020 R52.77 – R61.26

Takealot SAR 30/08/2016 3 704 R130.95 30/08/2018 to 30/08/2021 R48.72 – R65.50 Notes (1) The value of the SARs represents the fair value on grant date in accordance with IFRS in respect of scheme currency. (2) Retired as an executive director on 31 March 2018. Mark remained on the board as a non-executive director. 92 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Summarised consolidated annual financial statements Statement of responsibility by the board of directors for the year ended 31 March 2018

Contents

The summarised consolidated annual financial statements of the group are the responsibility of the directors of Naspers Page Limited. In discharging this responsibility they rely on the management of the group to prepare the consolidated annual Statement of responsibility by the board of directors 92 financial statements, separately available on www.naspers.com, in accordance with International Financial Reporting Standards (IFRS) and the Companies Act No 71 of 2008. The summarised consolidated annual financial statements include amounts Independent auditor’s report on the summary consolidated financial statements 93 based on judgements and estimates made by management. The information given is comprehensive and presented in a Segmental review 94 responsible manner. Reconciliation of consolidated trading loss to consolidated operating loss 95 The directors accept responsibility for the preparation, integrity and fair presentation of the summarised consolidated annual Summarised consolidated income statement 95 financial statements and are satisfied that the systems and internal financial controls implemented by management are effective. Summarised consolidated statement of comprehensive income 96 Summarised consolidated statement of changes in equity 97 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 summarised consolidated annual financial statements Summarised consolidated statement of financial position 97 support the viability of the company and the group. The preparation of the financial results was supervised by the financial Summarised consolidated statement of cash flows 98 director, Basil Sgourdos CA(SA). Notes to the summarised consolidated financial statements 99 The independent auditing firm PricewaterhouseCoopers Inc., which was given unrestricted access to all financial records and Further information 110 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 summarised consolidated annual financial statements were derived. The directors believe that representations made to the independent auditor during audit were valid and appropriate. PricewaterhouseCoopers Inc.’s audit report is presented on page 93.

The summarised consolidated annual financial statements were approved by the board of directors on 22 June 2018 and are signed on its behalf by:

Koos Bekker Bob van Dijk Chair Chief executive

22 June 2018 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 93

Independent auditor’s report on the summary consolidated financial statements

To the Shareholders of Naspers Limited Opinion Directors’ Responsibility for the Summary Consolidated Financial Statements The summary consolidated financial statements of Naspers Limited, set out on pages 94 to 107 of the integrated The directors are responsible for the preparation of the summary consolidated financial statements in accordance with annual report, which comprise the summary consolidated statement of financial position as at 31 March 2018, the summary the JSE’s requirements for summary financial statements, as set out in the “Basis of presentation and accounting policies” consolidated income statement, and summary consolidated statements of comprehensive income, changes in equity and section to the summary consolidated financial statements, and the requirements of the Companies Act of South Africa cash flows for the year then ended, and related notes, are derived from the audited consolidated financial statements of as applicable to summary financial statements. Naspers Limited for the year ended 31 March 2018. Auditor’s Responsibility In our opinion, the accompanying summary consolidated financial statements are consistent, in all material respects, with Our responsibility is to express an opinion on whether the summary consolidated financial statements are consistent, in the audited consolidated financial statements, in accordance with the JSE Limited’s (JSE) requirements for summary financial all material aspects, with the audited consolidated financial statements based on our procedures, which were conducted statements, as set out in the “Basis of presentation and accounting policies” section to the summary consolidated financial in accordance with International Standard on Auditing (ISA) 810 (Revised), Engagements to Report on Summary statements, and the requirements of the Companies Act of South Africa as applicable to summary financial statements. 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 PricewaterhouseCoopers Inc. statements. Reading the summary consolidated financial statements and the auditor’s report thereon, therefore, Director: Brendan Deegan is not a substitute for reading the audited consolidated financial statements and the auditor’s report thereon. Registered Auditor

The Audited Consolidated Financial Statements and Our Report Thereon Cape Town We expressed an unmodified audit opinion on the audited consolidated financial statements in our report dated 22 June 2018 22 June 2018. That report also includes communication of key audit matters. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period.

PricewaterhouseCoopers Inc., 5 Silo Square, V&A Waterfront, Cape Town 8002, P O Box 2799, Cape Town 8000 T: +27 (0) 21 529 2000, F: +27 (0) 21 529 3300, www.pwc.co.za

Chief Executive Officer: T D Shango Management Committee: S N Madikane, J S Masondo, P J Mothibe, C Richardson, F Tonelli, C Volschenk The Company’s principal place of business is at 4 Lisbon Lane, Waterfall City, Jukskei View, where a list of directors’ names is available for inspection. Reg. no. 1998/012055/21, VAT reg.no. 4950174682 94 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Segmental review

Revenue EBITDA(1) Trading profit Year ended 31 March Year ended 31 March Year ended 31 March 2018 2017 2018 2017 2018 2017 % Restated % Restated % US$’m US$’m change US$’m US$’m change US$’m US$’m change Internet 15 928 10 621 50 3 382 2 282 48 3 053 2 030 50 Social network services 12 281 7 692 60 3 997 2 964 35 3 726 2 761 35 – Tencent 12 024 7 506 60 3 925 2 888 36 3 675 2 701 36 – Mail.ru 257 186 38 72 76 (5) 51 60 (15) Ecommerce 3 647 2 929 25 (615) (682) 10 (673) (731) 8 – Etail 2 060 1 659 24 (248) (258) 4 (270) (281) 4 – Travel 276 123 >100 (59) (87) 32 (61) (88) 31 – Marketplaces – 327 (100) – 146 (100) – 137 (100) – Payments 294 186 58 (60) (66) 9 (64) (69) 7 – Classifieds 628 426 47 (99) (319) 69 (114) (328) 65 – Food delivery 166 53 >100 (20) 5 >(100) (30) 5 >(100) – Other 223 155 44 (129) (103) (25) (134) (107) (25)

Video entertainment 3 680 3 401 8 627 520 21 369 287 29 Media(2) 507 588 (14) 10 40 (75) 3 19 (84) Corporate services 3 2 50 (22) (14) (57) (22) (14) (57) Intersegmental (21) (50) 58 – – – – Economic interest 20 097 14 562 38 3 997 2 828 41 3 403 2 322 47 Less: Equity-accounted investments (13 437) (8 464) (59) (3 739) (2 756) (36) (3 444) (2 536) (36) Consolidated 6 660 6 098 9 258 72 258 (41) (214) 81

­Notes (1) EBITDA refers to earnings before interest, taxation, depreciation and amortisation. (2) Includes revenue of US$133m (2017: US$222.4m), EBITDA of US$33.3m (2017: US$55.1m) and trading profit of US$33.3m (2017: US$40.3m) relating to Novus Holdings Limited (Novus). The group distributed the majority of its shareholding in Novus to its shareholders in September 2017. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 95

Reconciliation of consolidated trading loss Summarised consolidated income statement to consolidated operating loss

Year ended Year ended 31 March 31 March 2018 2017 2018 2017 US$’m US$’m Restated % US$’m US$’m change Consolidated trading loss (41) (214) Revenue 6 660 6 098 9 Finance cost on transponder leases 51 46 Cost of providing services and sale of goods (4 025) (3 574) Amortisation of other intangible assets (101) (99) Selling, general and administration expenses (2 786) (2 827) Other (losses)/gains – net (47) (57) (47) Retention option expense (8) (1) Other (losses)/gains – net (57) Operating loss (198) (360) 45 Share-based incentives settled in treasury shares (52) (35) Interest received 88 70 Consolidated operating loss (198) (360) Interest paid (267) (278) For a reconciliation of consolidated operating loss to consolidated profit before taxation, refer to the summarised Other finance (costs)/income – net (319) (899) consolidated income statement. Share of equity-accounted results 3 277 1 829 Impairment of equity-accounted investments (46) – Dilution gains/(losses) on equity-accounted 9 216 (119) investments(1) (Losses)/gains on acquisitions and disposals (93) 2 169 Profit before taxation 11 658 2 412 >100 Taxation (360) (244) Profit for the year 11 298 2 168 >100 Attributable to: Equity holders of the group 11 357 2 337 Non-controlling interest (59) (169) 11 298 2 168

­Note (1) Includes the gain recognised on the disposal of a 2% interest in Tencent Holdings Limited. 96 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Summarised consolidated income statement Summarised consolidated statement continued of comprehensive income

Year ended Year ended 31 March 31 March 2018 2017 2018 2017 Restated % Restated US$’m US$’m change US$’m US$’m Core headline earnings for the year (US$’m) 2 507 1 454 72 Profit for the year(1) 11 298 2 168 Core headline earnings per N ordinary share 581 337 72 Total other comprehensive income, net of tax, for the year(2) 1 742 1 541 (US cents) Translation of foreign operations(3) 996 322 Diluted core headline earnings per N ordinary share 568 330 72 Net fair value (losses)/gains (4) (1) (US cents) Cash fow hedges (98) (85) Headline earnings for the year (US$’m) 1 794 188 >100 Share of other comprehensive income and reserves of equity-accounted investments 835 1 293 Headline earnings per N ordinary share (US cents) 416 44 >100 Tax on other comprehensive income 13 12 Diluted headline earnings per N ordinary share 403 38 >100 (US cents) Total comprehensive income for the year 13 040 3 709 Earnings per N ordinary share (US cents) 2 631 542 >100 Attributable to: Diluted earnings per N ordinary share (US cents) 2 612 535 >100 Equity holders of the group 13 025 3 905 Net number of shares issued (’000) Non-controlling interest 15 (196) – At year-end 432 126 431 540 13 040 3 709 – Weighted average for the year 431 635 431 207 Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change – Diluted weighted average 433 003 432 684 in accounting policy.

Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change ­Notes (1) Includes the gain recognised on the disposal of a 2% interest in Tencent Holdings Limited. in accounting policy. (2) These components of other comprehensive income may subsequently be reclassified to profit or loss except for gains of US$361m (2017: US$292m) included in the “Share of other comprehensive income and reserves of equity-accounted investments”. (3) The movement on the foreign currency translation reserve for the year relates primarily to the effects of foreign exchange rate fluctuations related to the group’s net investments in its foreign operations. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 97

Summarised consolidated statement Summarised consolidated statement of changes in equity of financial position

Year ended 31 March 31 March 1 April 2018 2017 2016 2018 2017 Restated Restated Restated US$’m US$’m US$’m US$’m US$’m ASSETS Balance at the beginning of the year 13 142 10 654 Non-current assets 22 386 16 291 13 486 Change in accounting policy – (1 504) Property, plant and equipment 1 638 1 638 1 443 13 142 Restated balance at the beginning of the year 9 150 Goodwill 2 607 2 442 2 818 Changes in share capital and premium Other intangible assets 1 143 1 104 1 190 (64) Movement in treasury shares (77) Investments in associates 16 666 10 784 7 625 85 Share capital and premium issued 56 Investments in joint ventures 78 79 218 Changes in reserves Other investments and loans 115 82 57 13 025 Total comprehensive income for the year 3 905 Other receivables 21 32 20 (48) Movement in share-based compensation reserve (376) Derivative financial instruments 1 2 – (195) Movement in existing control business combination reserve 16 Deferred taxation 117 128 115 125 Direct retained earnings and other movements 721 Current assets 13 065 5 639 3 237 (262) Dividends paid to Naspers shareholders (158) Inventory 231 154 194 Changes in non-controlling interest Programme and film rights 240 193 160 15 Total comprehensive income for the year (196) Trade receivables 452 420 393 (153) Dividends paid to non-controlling shareholders (116) Other receivables and loans 762 456 491 21 Movement in non-controlling interest in reserves 217 Derivative financial instruments 11 6 59 Balance at the end of the year 25 691 13 142 Cash and cash equivalents 11 369 4 007 1 714 Comprising: 13 065 5 236 3 011 Share capital and premium 4 965 4 944 Assets classified as held for sale – 403 226 Retained earnings 20 132 8 912 Total assets 35 451 21 930 16 723 Share-based compensation reserve 1 460 1 147 Existing control business combination reserve (1 847) (1 652) Hedging reserve (106) (30) Valuation reserve 1 679 1 387 Foreign currency translation reserve (761) (1 852) Non-controlling interests 169 286 Total 25 691 13 142

Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change in accounting policy. 98 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Summarised consolidated statement Summarised consolidated statement of financial position of cash flows continued

31 March Year ended 1 April 31 March 2018 2017 2016 Restated Restated 2018 2017 US$’m US$’m US$’m US$’m US$’m EQUITY AND LIABILITIES Cash flows from operating activities Share capital and reserves 25 522 12 856 8 771 Cash generated from operating activities 141 294 Share capital and premium 4 965 4 944 4 965 Interest income received 81 63 Other reserves 425 (1 000) (2 304) Dividends received from investments and equity-accounted companies 251 193 Retained earnings 20 132 8 912 6 110 Interest costs paid (240) (257) Non-controlling interests 169 286 379 Taxation paid (391) (333) Total equity 25 691 13 142 9 150 Net cash utilised in operating activities (158) (40) Non-current liabilities 5 623 5 349 5 118 Cash flows from investing activities (138) Capitalised finance leases 1 086 1 142 771 Acquisitions and disposals of tangible and intangible assets (173) (1 957) Liabilities – interest bearing 3 202 2 198 2 922 Acquisitions of subsidiaries, associates and joint ventures (397) 9 941 – non-interest bearing 22 9 8 Disposals of subsidiaries, associates and joint ventures 3 383 7 Other non-current liabilities 867 1 708 1 098 Cash movement in other investments and loans 1 Net cash generated from investing activities 7 853 Post-employment medical liability 30 14 13 2 814 Cash flows from financing activities Derivative financial instruments 157 13 20 1 124 Deferred taxation 259 265 286 Proceeds from long- and short-term loans raised 584 (827) Current liabilities 4 137 3 439 2 455 Repayments of long- and short-term loans (602) (22) Current portion of long-term debt 280 915 227 Outfow from share-based compensation transactions (36) (344) Trade payables 564 487 437 Dividends paid by the holding company and its subsidiaries (281) (319) Accrued expenses and other current liabilities 3 163 1 844 1 662 Other movements resulting from financing activities (76) (388) Derivative financial instruments 129 119 31 Net cash utilised in financing activities (411) Net movement in cash and cash equivalents 7 307 Bank overdrafts and call loans 1 4 1 2 363 58 4 137 3 369 2 358 Foreign exchange translation adjustments on cash and cash equivalents (50) 4 003 Liabilities classified as held for sale – 70 97 Cash and cash equivalents at the beginning of the year 1 713 – Total equity and liabilities 35 451 21 930 16 723 Cash and cash equivalents classified as held for sale (23) Cash and cash equivalents at the end of the year 11 368 Net asset value per N ordinary share (US cents) 5 906 2 979 2 035 4 003

Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change in accounting policy. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 99

Notes to the summarised consolidated financial statements for the year ended 31 March

Basis of presentation and accounting policies The summarised consolidated financial results for the year ended 31 March 2018 are prepared in accordance with the JSE The recent change in commercial intent to settle put options in cash rather than Naspers N ordinary shares, has prompted Limited (the JSE) Listings Requirements relevant to summarised financial statements and the provisions of the Companies Act us to reassess our accounting policy to ensure it remains reflective of the underlying settlement expectations. IFRS does not No 71 of 2008. The JSE Listings Requirements require summary financial statements to be prepared in accordance with the explicitly address accounting for put option liabilities that can be settled by issuing a variable number of an entity’s own shares, framework concepts, the measurement and recognition requirements of International Financial Reporting Standards (IFRS), as evidenced in the IFRS Interpretations Committee November 2016 rejection of this matter. As a result, an accounting policy the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as choice exists – they can either be accounted for as (i) derivative financial instruments (at fair value in terms of IAS 39 Financial issued by the Financial Reporting Standards Council, and to also, as a minimum, contain the information required by IAS 34 Instruments: Recognition and Measurement or IFRS 9 Financial Instruments), or (ii) as liabilities equal to the amount payable on Interim Financial Reporting. The summarised consolidated financial results do not include all the disclosures required for settlement (in terms of IAS 32 Financial Instruments: Presentation). complete annual financial statements prepared in accordance with IFRS as issued by the International Accounting Standards Board (IASB). The accounting policies applied in the preparation of the consolidated annual financial statements from which Up to 30 September 2017, put option liabilities were accounted for as derivative financial instruments given the historic the summarised consolidated financial results were derived, are consistent with those applied in the previous consolidated intention to settle in Naspers N ordinary shares. All put option liabilities were measured at a fair value of zero as these options annual financial statements, except as set out below. are priced at fair value, consequently there was no impact on the statement of financial position or income statement.

The group has adopted all new and amended accounting pronouncements issued by the IASB that are effective for financial Given the intention to now settle in cash, it is more appropriate to recognise them as liabilities in the statement of financial years commencing 1 April 2017. None of the new or amended accounting pronouncements that are effective for the financial position, at amounts reflecting the gross cash consideration payable on settlement. Consequently, in accordance with IAS 8, year commencing 1 April 2017 had a material impact on the group. we have changed our accounting policy in this respect. Going forward, all remeasurements of these liabilities will be recognised in the income statement. These remeasurements will be included in headline earnings but excluded from core headline The group’s reportable segments reflect the components of the group that are regularly reviewed by the chief executive and earnings. other senior executives who make strategic decisions. The group proportionately consolidates its share of the results of its associates and joint ventures in its reportable segments. The group has applied the change in accounting policy retrospectively and has restated the comparative information presented in these summarised consolidated financial statements for the year ended 31 March 2017. The summarised impact Trading profit excludes amortisation of intangible assets (other than software), equity-settled share-based payment expenses of the change in accounting policy on prior-period results is an increase in liabilities of US$2.22bn as at 31 March 2017, as well relating to transactions to be settled through the issuance of treasury shares, retention option expenses and other gains/losses, as the recognition of a remeasurement expense (including foreign exchange translation effects) in the income statement of but includes the finance cost on transponder leases. US$640m for the year ended 31 March 2017.

Core headline earnings exclude once-off and non-operating items. We believe it is a useful measure of the group’s operating The impact of the change in accounting policy on the summarised consolidated financial statements is outlined in the extracts performance. However, this is not a defined term under IFRS and may not be comparable with similarly titled measures that follow. reported by other companies. Change in accounting policy regarding written put option liabilities As part of its commitment to build shareholder value and prevent dilution, we indicated recently that we are unlikely to issue Naspers N ordinary shares to settle put option liabilities arising from mergers and acquisitions agreements, employee share option obligations or similar arrangements. Instead, the intention is to settle these items in cash, either through purchases of shares on the market or direct cash settlement.

When investing, we frequently partner with founders who remain in the business as non-controlling shareholders. To provide them with liquidity at a later date, agreements sometimes include put options that require the group to purchase the shares of non-controlling shareholders in future, with the option to settle by issuing Naspers N ordinary shares or in cash. In the past we selected to settle some of these by issuing Naspers N ordinary shares. 100 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Notes to the summarised consolidated financial statements continued for the year ended 31 March

Basis of presentation and accounting policies continued Statement of financial position (extract) Change in accounting policy regarding written put option liabilities continued Income statement (extract) 31 March 1 April 2017 2017 2017 2016 2016 2016 31 March Change in Change in accounting Previously accounting Previously 2017 2017 2017 Restated policy reported Restated policy reported Change in US$’m US$’m US$’m US$’m US$’m US$’m accounting Previously EQUITY AND Restated policy reported LIABILITIES US$’m US$’m US$’m Capital and reserves 12 856 (2 102) 14 958 8 771 (1 483) 10 254 Other finance (costs)/income – net (899) (640) (259) attributable to the Profit before taxation 2 412 (640) 3 052 group’s equity holders Taxation (244) – (244) Share capital and premium 4 944 – 4 944 4 965 – 4 965 Profit for the year 2 168 (640) 2 808 Other reserves (1 000) (1 518) 518 (2 304) (1 483) (821) Attributable to: Retained earnings 8 912 (584) 9 496 6 110 – 6 110 Equity holders of the group 2 337 (584) 2 921 Non-controlling interests 286 (117) 403 379 (21) 400 Non-controlling interests (169) (56) (113) TOTAL EQUITY 13 142 (2 219) 15 361 9 150 (1 504) 10 654 2 168 (640) 2 808 Non-current 5 349 1 708 3 641 5 118 1 095 4 023 liabilities (subtotal) Earnings per N ordinary share (US cents) Other non-current liabilities 1 708 1 708 – 1 098 1 095 3 Basic 542 (135) 677 Current liabilities 3 439 511 2 928 2 455 409 2 046 Diluted 535 (135) 670 (subtotal) Headline earnings per N ordinary share (US cents) Accrued expenses and 1 768 511 1 257 1 595 409 1 186 Basic 44 (135) 179 other current liabilities TOTAL EQUITY 21 930 – 21 930 16 723 – 16 723 Diluted 38 (135) 173 AND LIABILITIES Statement of comprehensive income

Profit for the year 2 168 (640) 2 808 Other comprehensive income for the year 1 541 (4) 1 545 Total comprehensive income for the year 3 709 (644) 4 353 Attributable to: Equity holders of the group 3 905 (587) 4 492 Non-controlling interests (196) (57) (139) 3 709 (644) 4 353

The group’s change in accounting policy regarding put options had no impact on core headline earnings. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 101

Notes to the summarised consolidated financial statements continued for the year ended 31 March

Basis of presentation and accounting policies continued Change in calculation of trading profit and core headline earnings Change in calculation of trading profit and core headline earnings The group is required to calculate and present headline earnings (and the related basic and diluted per-share equivalents) IFRS 8 Operating Segments requires segmental reporting to reflect the manner in which financial information is communicated in terms of the JSE Listings Requirements. Headline earnings represents an earnings metric that is intended to provide internally to management. We therefore report trading profit on an economic-interest basis (ie including a proportionate a like-for-like basis on which the earnings of entities can be compared. consolidation of the trading profits of associates and joint ventures) in the segmental review which, similar to core headline earnings, excludes amortisation expenses on certain intangible assets. For the reasons outlined above, we will similarly no In addition to headline earnings, we also calculate and present trading profit and core headline earnings. These are non-IFRS, longer adjust trading profit to exclude the amortisation expenses recognised by Tencent on its digital content. The effect is to Naspers-defined metrics and are presented as additional information to shareholders as we consider them more reflective adjust trading profit downward from US$ 2.7bn to US$ 2.3bn for the year ended 31 March 2017. Consolidated trading profit of our operating performance. In arriving at core headline earnings, adjustments are made to the earnings of consolidated is unaffected by this change. businesses, as well as the underlying earnings of associates and joint ventures, to the extent that the information is available. To ensure comparability between reporting periods, we have updated the comparative information for trading profit Ensuring that core headline earnings remains reflective of our future potential operating performance, a review of the items and core headline earnings (including basic and diluted per-share equivalents) in these summarised consolidated financial adjusted for in the calculation is required as circumstances change. statements. The change to trading profit and core headline earnings had no impact on the group’s statement of financial position and income statement presented in accordance with IFRS. We have historically adjusted core headline earnings for all amortisation expenses, excluding software, as these expenses have primarily related to intangible assets resulting from business combinations and other acquisitions. These expenses are not considered operational in nature.

Our associate Tencent has, in recent years, made a strategic decision to develop a number of digital content offerings (including video and music), with significant success. Consequently, acquired content now represents a meaningful part of the overall cost base for the digital content business, resulting in an increase in intangible assets and related amortisation expenses. As a result of this development, we considered it prudent to refine the treatment of amortisation within the core headline earnings calculation and to now include the digital-content element of Tencent’s amortisation expenses in core headline earnings. Only amortisation related to intangible assets identified in business combinations and other acquisitions continues to be adjusted for in the core headline earnings calculation. The effect is to adjust core headline earnings downward from US$1.8bn to US$1.5bn for the year ended 31 March 2017. 102 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Notes to the summarised consolidated financial statements continued for the year ended 31 March

Headline and core headline earnings Interest (paid)/received Year ended Year ended 31 March 31 March 2018 2017 2018 2017 Restated Restated US$’m US$’m US$’m US$’m Net profit attributable to shareholders 11 357 2 337 Interest received 88 70 Adjusted for: – loans and bank accounts 74 56 – impairment of property, plant and equipment and other assets 39 26 – other 14 14 – impairment of goodwill and other intangible assets 4 28 Interest paid (267) (278) – (profit)/loss on sale of assets (1) 1 – loans and overdrafts (196) (198) – loss on remeasurement of disposal groups classified as held for sale to fair value – 2 – transponder leases (51) (46) less costs of disposal – other (20) (34) – losses/(gains) on acquisitions and disposals of investments 95 (2 219) Other finance (cost)/income – net (319) (899) – remeasurement of previously held interest (21) – – net foreign exchange differences and fair-value adjustments on derivatives (67) (277) (1) – dilution (gains)/losses on equity-accounted investments (9 216) 119 – remeasurement of written put option liabilities (252) (622) – remeasurements included in equity-accounted earnings (524) (102) – impairment of equity-accounted investments 46 – 1 779 192 Total tax effects of adjustments 18 (17) Total adjustment for non-controlling interest (3) 13 Headline earnings 1 794 188 Adjusted for: – equity-settled share-based payment expenses 435 296 – amortisation of other intangible assets(2) 190 169 – fair-value adjustments and currency translation differences(3) 60 756 – retention option expense 8 1 – business combination-related losses 20 44 Core headline earnings 2 507 1 454

Notes (1) Includes the gain recognised on the disposal of a 2% interest in Tencent Holdings Limited. (2) Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change in calculation of core headline earnings. Amortisation of other intangible assets for the year ended 31 March 2017 has been adjusted to include amortisation expenses of US$298m regarding Tencent’s digital content business. (3) Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change in accounting policy. Fair-value adjustments and currency translation differences for the year ended 31 March 2017 has been adjusted by US$584m for the impact of remeasurements of written put options. The diluted earnings, headline earnings and core headline earnings per-share figures presented on the face of the income statement include a decrease of US$49m (2017: US$24m) relating to the future dilutive impact of potential ordinary shares issued by equity-accounted investees and subsidiaries. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 103

Notes to the summarised consolidated financial statements continued for the year ended 31 March

Equity-accounted results Profit before taxation The group’s equity-accounted investments contributed to the summarised consolidated financial results as follows: 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 Year ended 31 March 2018 2017 Restated 2018 2017 US$’m US$’m US$’m US$’m Share of equity-accounted results 3 277 1 829 Depreciation of property, plant and equipment 219 214 – sale of assets 1 3 Amortisation 133 128 – disposal of investments (692) (381) – other intangible assets 101 99 – impairment of investments 159 268 – software 32 29 Contribution to headline earnings 2 745 1 719 Costs related to programme and film rights, including amortisation 912 859 – amortisation of other intangible assets 135 106 Net realisable value adjustments on inventory, net of reversals(1) 48 51 – equity-settled share-based payment expenses 385 268 Other (losses)/gains – net (47) (57) – fair-value adjustments and currency translation differences (224) – – gain/(loss) on sale of assets 2 (1) Contribution to core headline earnings 3 041 2 093 – impairment of goodwill and other intangible assets (4) (30) Tencent 3 288 2 237 – impairment of property, plant and equipment and other assets (39) (26) Mail.ru 37 52 – remeasurement of disposal groups classified as held for sale to fair value – (2) MakeMyTrip (76) – less costs of disposal 2 Delivery Hero (21) – – dividends received on investments 1 (6) Other (187) (196) – fair-value adjustments on financial instruments 1 – other (2) – The group applies an appropriate lag period in reporting the results of equity-accounted investments where the (Losses)/gains on acquisitions and disposals (93) 2 169 year-ends of investees are not coterminous with that of Naspers Limited. – (loss)/profit on sale of investments (91) 1 990 – gains recognised on loss of control transactions – 228 – remeasurement of contingent consideration (5) 1 – acquisition-related costs (18) (50) – remeasurement of previously held interest 21 –

­Note (1) Net realisable value write-downs relate primarily to set-top box subsidies in the video-entertainment segment. 104 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Notes to the summarised consolidated financial statements continued for the year ended 31 March

Goodwill Commitments and contingent liabilities Goodwill is subject to an annual impairment assessment. Movements in the group’s goodwill for the year are Commitments relate to amounts for which the group has contracted, but that have not yet been recognised as detailed below: obligations in the statement of financial position. Year ended 31 March Year ended 31 March 2018 2017 US$’m US$’m 2018 2017 US$’m Goodwill US$’m Commitments 3 537 – cost 2 790 3 175 2 464 – capital expenditure 17 13 – accumulated impairment (348) (357) – programme and film rights 2 906 2 015 Opening balance 2 442 2 818 – network and other service commitments 104 158 – foreign currency translation effects 41 210 – operating lease commitments 327 163 – acquisitions of subsidiaries and businesses 124 244 – set-top box commitments 183 115 – disposals of subsidiaries and businesses – (786) – – transferred to assets classified as held for sale (37) The group operates a number of businesses in jurisdictions where taxes are payable on certain transactions or – impairment – (5) payments. The group continues to seek relevant advice and works with its advisers to identify and quantify such tax – exposures. Our current assessment of possible withholding and other tax exposures, including interest and potential – remeasurement to fair value less costs of disposal (2) penalties, amounts to approximately US$226.1m (2017: US$256.7m). No provision has been made as at 31 March 2018 Closing balance 2 607 2 442 and 2017 for these possible exposures. 2 961 – cost 2 790 Disposal groups classified as held for sale – accumulated impairment (354) (348) During the year ended 31 March 2017 the group announced the unbundling of the majority of its shareholding in its subsidiary Novus Holdings Limited (Novus), operating in the print industry in South Africa. The assets and liabilities of Novus were classified as held for distribution as at 31 March 2017. In August 2017 the group received regulatory approval for the unbundling which was finalised during September 2017.

In May 2017 the group concluded the disposal of its joint venture Souq Group Limited (Souq), following the receipt of regulatory approval. Souq was classified as held for sale as at 31 March 2017.

The group also concluded the disposals of various other smaller units of which the assets and liabilities were classified as held for sale as at 31 March 2017. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 105

Notes to the summarised consolidated financial statements continued for the year ended 31 March

Disposal groups classified as held for sale continued In December 2017 the group acquired an additional 38% interest in Takealot from non-controlling shareholders. The The group had no assets and liabilities classified as held for sale as at 31 March 2018. Assets and liabilities classified as held transaction was settled in Naspers N ordinary shares, purchased on the open market, with a fair value of US$128m on for sale in prior periods are detailed in the following table: settlement date. The excess of the consideration transferred over the net asset value acquired was recognised in the “Existing control business combination reserve” in equity and totalled US$65m. An amount of US$4m was recognised in Year ended the valuation reserve being the difference between the fair value and acquisition cost of the shares transferred. Following 31 March the transaction, the group holds a 96% effective interest (91% fully diluted) in Takealot. 2018 2017 US$’m US$’m In November 2017 the group invested US$41m to acquire a 100% effective interest in The Car Trader Proprietary Limited (AutoTrader), an online automobile classifieds vertical in South Africa. The transaction was accounted for as a business Assets – 403 combination with an effective date of November 2017. The total purchase consideration amounted to US$41m. The Property, plant and equipment – 176 purchase price allocation: property, plant and equipment US$1m; cash and deposits US$3m; trade and other receivables US$1m; intangible assets US$27m; trade and other payables US$4m; loan liabilities US$14m; deferred tax liabilities US$8m Goodwill and other intangible assets – 35 and the balance of US$35m to goodwill. The main classes of intangible assets recognised in the business combination were Investment in joint venture – 102 brands, customer relationships and technology. Deferred taxation assets – 7 Since the acquisition dates of the above business combinations, revenue of US$195m and net results/(losses) of US$41m Inventory – 26 have been included in the income statement relating to Takealot and AutoTrader. Had the revenue and net results of Takealot and AutoTrader been included from 1 April 2017, group revenue and net profit would have amounted to Trade and other receivables – 34 US$6.75bn and US$11.26bn respectively. Cash and cash equivalents – 23 The main factor contributing to the goodwill recognised in the acquisitions is the acquirees’ market presence. The goodwill Liabilities – 70 that arose is not expected to be deductible for income tax purposes. Total acquisition-related costs of US$3m were Deferred taxation liabilities – 19 recorded in “(Losses)/gains on acquisitions and disposals” in the income statement regarding the above-mentioned acquisitions. Long-term liabilities – 6 Trade payables – 18 The following relates to the group’s investments in its equity-accounted investees: – Accrued expenses and other current liabilities 27 The group made various investments in Delivery Hero AG (Delivery Hero), a global online food-ordering and delivery marketplace, during the year. In May 2017 the group acquired its initial interest in Delivery Hero through an investment of The group recognised a loss of US$nil (2017: US$1.6m) as part of “Other (losses)/gains – net” in the income statement US$426m. On 30 June 2017, Delivery Hero successfully completed an initial public offering of its shares, a process during on remeasuring the net assets of businesses classified as held for sale to their fair value less costs of disposal during the which the group invested a further US$47m. Following these investments, the group held an 11% effective interest (10% year. The fair value of the businesses was determined based on third-party sales prices. This represents a level 3 fully diluted) in Delivery Hero. In December 2017 the group invested an additional US$47m as part of a private placement fair-value measurement. in order to maintain its relative shareholding. During March 2018, following the receipt of regulatory approval, the group acquired Rocket Internet SE’s interest in Delivery Hero for US$778m. The group’s aggregate investment in Delivery Hero Business combinations, other acquisitions and disposals therefore amounts to US$1.3bn over the reporting period. Following the acquisition from Rocket Internet SE, the group holds a 23% effective interest (22% fully diluted) in Delivery Hero. The group accounts for its interest in Delivery Hero as In August 2017 the group invested US$74m to acquire a controlling interest in its associate Takealot Online (RF) Proprietary an investment in an associate. Limited (Takealot), the leading etailer in South Africa. Following the investment, the group held a 58% effective interest in Takealot. The transaction was accounted for as a business combination with an effective date of August 2017. The total The group made two investments during June 2017 and February 2018 amounting to US$121m in total, in Bundl purchase consideration amounted to US$123m representing the fair value of the group’s previously held equity interest in Technologies Private Limited (Swiggy), the operator of a first-party food-delivery marketplace in India. Following these Takealot. A gain of US$20m has been recognised in “(Losses)/gains on acquisitions and disposals” in the income statement investments, the group holds a 22% effective interest (21% fully diluted) in Swiggy. The group accounts for its interest in on the remeasurement of the group’s previously held equity interest in Takealot to its fair value. The US$74m cash invested Swiggy as an investment in an associate. remains within the group following the transaction and is accordingly not disclosed as part of the consideration transferred by the group or assets of Takealot acquired, although it did affect the amount of goodwill recognised in the business In May 2017 the group invested US$99m in Kreditech Holding SSL GmbH (Kreditech), a provider of consumer lending and combination. The purchase price allocation: property, plant and equipment US$13m; cash and deposits US$105m; financial services. The group has also provided convertible loan funding of €20m to Kreditech. Following the investment, the inventories US$28m; trade and other receivables US$4m; intangible assets US$107m; trade and other payables US$27m; group holds a 38% effective interest (31% fully diluted) in Kreditech. The group accounts for its interest in Kreditech as an deferred tax liabilities US$30m and the balance of US$81m to goodwill. The main classes of intangible assets recognised in investment in an associate. the business combination were trade names and brands, customer relationships and technology. The transaction gave rise to the recognition of non-controlling interest of US$83m, which has been measured at the non-controlling interest’s proportionate share of the identifiable net assets of Takealot as at the acquisition date. 106 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Notes to the summarised consolidated financial statements continued for the year ended 31 March

Business combinations, other acquisitions and disposals continued Financial instruments During May 2017 the group invested US$132m in its associate MakeMyTrip Limited (MakeMyTrip) as part of a funding round. In August and September 2017, following MakeMyTrip’s issue of share options to its employees, the group invested The fair values of the group’s financial instruments that are measured at fair value at each reporting period are US$23m to maintain its relative shareholding. Following these transactions, the group holds a 43% effective interest (40% categorised as follows: fully diluted) in MakeMyTrip.

The group invested US$71m for an additional interest in its associate Flipkart Limited (Flipkart) in April 2017. The additional Fair-value measurements interest was acquired from existing shareholders of Flipkart. Flipkart undertook various funding rounds during the year at 31 March 2018 using: in which the group did not participate. These funding rounds resulted in a dilution of the group’s interest in Flipkart and in Quoted prices in active Significant the recognition of an aggregate net dilution gain of US$252m in “Dilution gains/(losses) on equity-accounted investments” markets for identical Significant other unobservable in the income statement. Following the dilutions, the group holds a 12% effective interest (11% fully diluted) in Flipkart. assets or liabilities observable inputs inputs (level 1) (level 2) (level 3) In November 2017 the group invested US$100m in Remitly, Inc. (Remitly), a global digital money-transfer service. The US$’m US$’m US$’m investment resulted in the group acquiring a 23% effective interest (20% fully diluted) in Remitly. The group accounts for its interest in Remitly as an investment in an associate. Assets Available-for-sale investments 33 2 – The following relates to significant disposals by the group during the reporting period: Forward exchange contracts – 9 – During May 2017 the group disposed of its investment in its joint venture Souq Group Limited for a consideration of Derivatives embedded in leases – – 1 US$173m. A gain on disposal of US$89m has been recognised in “(Losses)/gains on acquisitions and disposals” in the income statement following the transaction. Currency devaluation features – – 2 Liabilities In September 2017, following the receipt of regulatory approval, the group distributed the majority of its shareholding in Novus Holdings Limited (Novus) to its shareholders. The group recognised the distribution as an in specie dividend, Forward exchange contracts – 162 – reducing retained earnings by US$69m, being the fair value of the distributed Novus shares. A loss on disposal of US$145m Earn-out obligations – – 58 has been recognised in “(Losses)/gains on acquisitions and disposals” in the income statement following the distribution, being the difference between the fair value of the distributed Novus shares and the book value of the assets distributed Interest rate and cross-currency swaps – 124 – as well as the reclassification of reserves of US$112m. After the distribution, the group holds a 19% interest in Novus and accounts for this interest as an available-for-sale investment. Fair-value measurement at 31 March 2017 using: During February 2018 the group disposed of its investment in its joint venture Konga Online Shopping Limited. A loss on disposal of US$38m, representing the reclassification of the group’s foreign currency translation reserve from other Quoted prices in active Significant comprehensive income to the income statement, has been recognised in “(Losses)/gains on acquisitions and disposals”. markets for identical Significant other unobservable assetsor liabilities observable inputs inputs In March 2018 the group disposed of approximately 6% of its interest in its associate, Tencent Holdings Limited (Tencent). (level 1) (level 2) (level 3) The disposal was executed by way of an accelerated offering by private placement on the Hong Kong Stock Exchange for US$’m US$’m US$’m a cash consideration of US$9.76bn. The disposal reduced the group’s shareholding from 33.17% to 31.17%. A dilution gain Assets of US$9.1bn has been recognised in “Dilution gains/(losses) on equity-accounted investments” following the transaction, resulting in a cumulative net dilution gain of US$8.98bn for the year on the group’s investment in Tencent. Available-for-sale investments 11 2 – Forward exchange contracts – 2 – Issue of listed bond Currency devaluation features – – 6 Liabilities The group issued a 10-year US$1.0bn international bond in July 2017. The bond matures in July 2027 and carries a fixed interest rate of 4.85% per annum. The proceeds were partially utilised to repay the group’s US$700m international bond Forward exchange contracts – 106 – which matured in July 2017. The remaining proceeds will be utilised for general corporate purposes, including acquisitions. Shareholders’ liabilities – – 18 Earn-out obligations – – 24 Interest rate swaps – 8 – Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 107

Notes to the summarised consolidated financial statements continued for the year ended 31 March

Financial instruments continued Related party transactions and balances There have been no transfers between levels 1 or 2 during the reporting period, nor were there any significant changes to the valuation techniques and inputs used in measuring fair value. The group entered into various related party transactions in the ordinary course of business. There have been no significant changes in related party transactions and balances since the previous reporting period. Currency devaluation features relate to clauses in content acquisition agreements that provide the group with protection against significant currency devaluations. The fair value of currency devaluation features is measured through the use of Events after the reporting period discounted cash flow techniques. In April 2018 the group acquired the share capital held by non-controlling shareholders of its subsidiary Dubizzle Limited For earn-out obligations, current forecasts of the extent to which management believes performance criteria will be (Dubizzle) for US$190m. Following the acquisition, the group holds a 100% effective interest in Dubizzle. met, discount rates reflecting the time value of money and contractually specified earn-out payments are used. Changes in these assumptions could affect the reported fair value of these financial instruments. In May 2018 the group announced the sale of its interest in Flipkart Limited – its equity-accounted etail investment in India – to US-based retailer Walmart Inc. for US$2.2bn. The transaction is subject to regulatory approval. The fair value of level 2 financial instruments is determined with the use of exchange rates quoted in active markets and In May 2018 the group invested US$35m for a 16% effective interest in Honor Technology Inc., a first-of-its-kind interest rate extracts from observable yield curves. home-care company providing in-home senior care. Financial instruments for which fair value is disclosed: In May 2018 the group invested US$89m for a 36% effective interest in FCG Germany GmbH (Frontier Car Group), Carrying Fair an online car marketplace headquartered in Berlin. value value 31 March 2018 US$’m US$’m In June 2018 the group committed to an investment of US$80m in its associate, Bundl Technologies Private Limited (Swiggy), the operator of a first-party food-delivery marketplace in India. Following this investment, the group will hold Financial liabilities a 24% effective interest (23% fully diluted) in Swiggy. Capitalised finance leases 1 158 1 125 Publicly traded bonds 3 200 3 357 Pro forma financial information The group has presented certain revenue and trading profit metrics in local currency, excluding the effects of changes Carrying Fair in the composition of the group (the pro forma financial information) in the following tables. The pro forma financial value value information is the responsibility of the board of directors (the board) of Naspers Limited and is presented for illustrative 31 March 2017 US$’m US$’m purposes. Information presented on a pro forma basis has been extracted from the group’s management accounts, the Financial liabilities quality of which the board is satisfied with. Capitalised finance leases(1) 1 211 1 199 Shareholders are advised that, due to the nature of the pro forma financial information and the fact that it has been extracted from the group’s management accounts, it may not fairly present the group’s financial position, changes in Publicly traded bonds 2 900 3 041 equity, results of operations or cash flows. ­Note (1) Includes financial liabilities classified as held for sale. The pro forma financial information has been prepared to illustrate the impact of changes in foreign exchange rates and changes in the composition of the group on its results for the period ended 31 March 2018. The following methodology The fair values of the capitalised finance leases have been determined through discounted cash flow analysis. The fair was applied in calculating the pro forma financial information: 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. 1. 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 South African rand (2018: 0.0774; 2017: 0.0713); Polish zloty (2018: 0.2794; 2017: 0.2516); Russian rouble (2018: 0.0173; 2017: 0.0159); Chinese yuan renminbi (2018: 0.1517; 2017: 0.1483); Indian rupee (2018: 0.0155; 2017: 0.0149); Brazilian real (2018: 0.3097; 2017: 0.3061); and Nigerian naira (2018: 0.0028; 2017: 0.0035). 2. Adjustments made for changes in the composition of the group relate to acquisitions and disposals of subsidiaries and equity-accounted investments, as well as to changes in the group’s shareholding in its equity-accounted investments. For mergers, the group composition adjustments include a portion of the prior year’s results of the entity with which the merger took place. 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: 108 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Notes to the summarised consolidated financial statements continued for the year ended 31 March

Pro forma financial information continued The adjustments to the amounts, reported in terms of IFRS, which have been made in arriving at the pro forma financial information, are presented in the table below: Year ended 31 March 2018 Year ended 31 March Transaction Basis of accounting Reportable segment Acquisition/Disposal 2017 2018 2018 2018 2018 2018 2018 2018 (2) (3) (4) Dilution of the group’s Associate Social and internet Disposal A B C D E F G H interest in Tencent platforms Group Group Dilution of the group’s Associate Social and internet Disposal compo- compo- interest in Mail.ru platforms sition sition ac- Foreign disposal quisition currency Local Local Dilution of the group’s Associate Ecommerce Disposal adjust- adjust- adjust- currency currency interest in Flipkart IFRS(1) ment ment ment growth IFRS(1) growth IFRS Acquisition of the group’s Associate Ecommerce Acquisition US$’m US$’m US$’m US$’m US$’m US$’m % change % change interest in Kreditech Revenue Acquisition of the group’s Associate Ecommerce Acquisition interest in Delivery Hero Internet 10 621 (608) 295 511 5 109 15 928 51 50 Effect of merger of ibibo Associate Ecommerce Acquisition and Social and internet 7 692 (45) 23 361 4 250 12 281 56 60 with MakeMyTrip disposal platforms Disposal of the group’s Joint venture Ecommerce Disposal – Tencent 7 506 (40) – 341 4 217 12 024 56 60 interest in Souq – Mail.ru 186 (5) 23 20 33 257 18 38 Acquisition of the group’s Subsidiary Ecommerce Acquisition Ecommerce 2 929 (563) 272 150 859 3 647 36 25 interest in Takealot – Etail 1 659 (338) 167 97 475 2 060 36 24 Acquisition of the group’s Subsidiary Ecommerce Acquisition interest in AutoTrader – Travel 123 120 (20) 2 51 276 21 >100 Disposal of the group’s Subsidiary Ecommerce Disposal – Marketplaces 327 (327) – – – – – (100) interest in Netretail – Payments 186 (8) 39 11 66 294 37 58 Disposal of the group’s Subsidiary Ecommerce Disposal – Classifieds 426 – 14 38 150 628 35 47 interest in Allegro and Ceneo – Food delivery 53 – 49 – 64 166 >100 >100 Disposal of the group’s Subsidiary Media Disposal – Other 155 (10) 23 2 53 223 37 44 interest in Novus Video entertainment 3 401 (73) 1 119 232 3 680 7 8 The net adjustment made for all acquisitions and disposals that took place during the year ended 31 March 2018 Media 588 (123) – 37 5 507 1 (14) amounted to a negative adjustment of US$508m on revenue and a negative adjustment of US$181m on trading profit. Corporate services 2 – – – 1 3 50 50 An assurance report issued in respect of the pro forma financial information, by the group’s external auditor, is available Intersegmental (50) – – (1) 30 (21) 60 58 at the registered office of the company. Economic interest 14 562 (804) 296 666 5 377 20 097 39 38

­Notes ­(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. Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 109

Notes to the summarised consolidated financial statements continued for the year ended 31 March

Pro forma financial information continued Year ended 31 March Year ended 31 March 2017 2018 2018 2018 2018 2018 2018 2018 2017 2018 2018 2018 2018 2018 2018 2018 A B C D E F(2) G(3) H(4) A B C D E F(1) G(2) H(3) Group Group Group Group compo- compo- compo- compo- sition sition ac- Foreign sition sition ac- Foreign disposal quisition currency Local Local disposal quisition currency Local Local adjust- adjust- adjust- currency currency adjust- adjust- adjust- currency currency IFRS(1) ment ment ment growth IFRS(1) growth IFRS IFRS ment ment ment growth IFRS growth IFRS US$’m US$’m US$’m US$’m US$’m US$’m % change % change US$’m US$’m US$’m US$’m US$’m US$’m % change % change Trading profit Other metrics reported Internet 2 030 (79) (90) 102 1 090 3 053 56 50 Development Social and internet 2 761 (17) (7) 92 897 3 726 33 35 spend platforms – economic 1 084 (15) – 18 (131) 956 (12) (12) – Tencent(5) 2 701 (15) – 87 902 3 675 34 36 interest – consolidated 861 (85) – 15 (122) 669 (17) (22) – Mail.ru 60 (2) (7) 5 (5) 51 (9) (15) Consolidated 6 098 (780) 287 268 787 6 660 15 9 (62) (83) 10 193 (673) 24 8 Ecommerce (731) revenue 79 (39) (8) (21) (270) (10) 4 – Etail (281) Consolidated 2 173 (586) 286 114 511 2 498 32 15 – Travel (88) 6 4 – 17 (61) 21 31 ecommerce revenue – Marketplaces 137 (137) – – – – – (100) (34) (51) 31 227 (41) (92) (81) (9) (17) (2) 33 (64) 42 7 Consolidated (214) – Payments (69) trading loss – 1 18 195 (114) 59 65 – Classifieds (328) Avito revenue 204 – – 22 58 284 28 39 – Food delivery 5 – (23) 1 (13) (30) >(100) >(100) Core headline earnings, calculated in local currency terms, amounted to US$2.42bn. – Other (107) (1) (9) 1 (18) (134) (17) (25)

Video entertainment 287 (2) – 17 67 369 24 29 Development spend is not an IFRS measure and has therefore been excluded from the assurance report issued by the group’s external auditor. Media 19 (18) 8 – (6) 3 >(100) (84) ­Notes Corporate services (14) – – (4) (4) (22) (29) (57) (1) A + B + C + D + E. (2) E/(A + B) x 100. Economic interest 2 322 (99) (82) 115 1 147 3 403 52 47 (3) (F/A) – 1 x 100.

­Notes ­(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) Refer to the basis of preparation of these summarised consolidated financial statements for details of the group’s change in calculation of trading profit. 110 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Further information

Shenzhen, China Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 111 Notice of annual general meeting

Notice is hereby given in terms of the to be represented at the annual general audited annual financial statements of (contact person Ms Yasmin Abrahams) undertake the audit) for the period Companies Act No 71 of 2008, as meeting. Completion of a form of proxy the company for the immediate preceding and in Johannesburg at MultiChoice until the next annual general amended (the Act), that the 104th will not preclude such a shareholder financial year, an audit committee City, 144 Bram Fischer Drive, Randburg meeting of the company. annual general meeting of Naspers from attending and voting (in preference report and the social and ethics 2194 (contact person Mrs Toni Lutz). 4. To approve the appointment of Limited (the company or Naspers) will to that shareholder’s proxy) at the committee report; (ii) to consider and, Mr M R Sorour as non-executive be held on the 2nd floor, Daisy Room, annual general meeting. if approved, to adopt with or without Ordinary resolutions director with effect from 1 April Cape Town International Convention amendment, the resolutions set out In order for the ordinary resolutions 2018. His abridged curriculum vitae Centre 2 (CTICC2), corner of Holders of dematerialised shares, below; and (iii) to consider any matters below to be adopted, the support appears on page 60 of the Heerengracht and Rua Bartholomeu other than ’own name’ dematerialised raised by the shareholders of the of a majority of votes exercised by integrated annual report. The board Dias, Foreshore, Cape Town, South shareholders, who wish to vote at the company, with or without advance shareholders present or represented unanimously recommends the Africa on Friday 24 August 2018 at 11:15. annual general meeting, must instruct notice to the company. by proxy at this meeting is required. approval of the appointment of the their central securities depository Ordinary resolution number 10 director in question. Please note that the registration participant (CSDP) or broker Electronic participation requires the support of at least 75% 5. To elect Messrs C L Enenstein, counter for purposes of registering accordingly in the manner and Shareholders entitled to attend and of the total number of votes exercised D G Eriksson, H J du Toit, G Liu and to vote at this meeting on Friday cutoff time stipulated by their vote at the meeting or proxies of by the shareholders present or R Oliveira de Lima, who retire by 24 August 2018 will close at 11:00. CSDP or broker. such shareholders shall be entitled to represented by proxy at this meeting. rotation and, being eligible, offer participate in the meeting (but not vote) themselves for re-election as Record date, attendance and voting Holders of dematerialised shares, by electronic communication. Should a 1. To consider and accept the financial directors of the company. Their The record date for the meeting (being other than ’own name’ dematerialised shareholder wish to participate in the statements of the company and the abridged curricula vitae appear on the date used for the purpose of shareholders, who wish to attend the meeting by electronic communication, group for the twelve (12) months pages 59 and 60 of the integrated determining which shareholders are annual general meeting in person, need the shareholder concerned should advise ended 31 March 2018 and the annual report. entitled to participate in and vote at to arrange the necessary authorisation the company thereof by no later than reports of the directors, the auditor The board unanimously recommends the meeting) is 17 August 2018. as soon as possible through their CSDP 09:00 on Friday 17 August 2018 by and the audit committee. The that the re-election of directors in or broker. submitting via registered mail addressed summarised form of the financial terms of resolution number 5 be Votes at the annual general meeting will to the company (for the attention of Mrs statements is attached to this notice. approved by the shareholders of be taken by way of a poll and not on A shareholder may appoint a proxy Gillian Kisbey-Green) relevant contact A copy of the complete annual the company. a show of hands. at any time. For practical purposes, details, as well as full details of the financial statements of the company the form appointing a proxy and the shareholder’s title to securities issued by for the financial year ended The appointment of the director in A shareholder entitled to attend and authority (if any) under which it is signed, the company and proof of identity, in the 31 March 2018 can be obtained ordinary resolution number 4 and vote at the meeting is entitled to must reach the transfer secretaries of form of certified copies of identity from www.naspers.com or on the re-election of directors in appoint a proxy to attend, participate the company (Link Market Services documents and share certificates (in the request during normal business ordinary resolution number 5 will be in and vote at the meeting in the place South Africa Proprietary Limited, 13th case of materialised shares) and (in the hours at Naspers’s registered conducted as a series of votes, each of the shareholder. A proxy need not floor, Rennie House, 19 Ameshoff case of dematerialised shares) written address, 40 Heerengracht, Cape being for the candidacy of a single be a shareholder of the company. Street, Braamfontein 2001 or PO Box confirmation from the shareholder’s Town 8000 (contact person individual to fill a single vacancy, and 4844, Johannesburg 2000) by no later CSDP, confirming the shareholder’s title Ms Yasmin Abrahams) and in in each vote to fill a vacancy, each Before any person may attend or than 11:15 on Wednesday 22 August to the dematerialised shares. Upon Johannesburg at MultiChoice City, voting right entitled to be exercised, participate in a shareholders’ meeting, 2018 to allow for processing of such receipt of the required information, the 144 Bram Fischer Drive, Randburg may be exercised once. that person must present reasonably proxy. Should you hold Naspers shareholder concerned will be provided 2194 (contact person Mrs Toni Lutz). 6. To appoint the audit committee satisfactory identification and the A ordinary shares, the signed proxy with a secure code and instructions to 2. To confirm and approve payment members as required in terms of the person presiding at the meeting must must reach the registered office of the access the electronic communication of dividends in relation to the N Act and as recommended by the be reasonably satisfied that the right company by no later than 11:15 on during the annual general meeting. ordinary and A ordinary shares of King IV™ Report for Corporate of that person to participate and vote, Wednesday 22 August 2018 to allow Shareholders must note that access to the company as authorised by the Governance for South Africa 2016 either as a shareholder or as a proxy for processing of such proxy. A form the electronic communication will be at board after having applied the (King IV™) (principle 8). for a shareholder, has been reasonably of proxy is enclosed with this notice. the expense of the shareholders who solvency and liquidity tests The board and the nomination verified. Forms of identification include The form of proxy may also be wish to utilise the facility. contemplated in the Act. committee are satisfied that the valid identity documents, driver’s obtained from the registered office of 3. To reappoint, on the company’s audit committee licences and passports. the company. All other proxies must be Integrated annual report recommendation of the company’s members are suitably skilled and handed to the company secretary prior The integrated annual report of the audit committee, the firm experienced independent A form of proxy, which includes the to the commencement of the meeting. company for the year ended 31 March PricewaterhouseCoopers Inc. as non-executive directors. Collectively relevant instructions for its completion, 2018 is available on www.naspers.com independent registered auditor they have sufficient qualifications and is attached for the use of holders of Purpose of meeting or on request during normal business of the company (noting that Mr B experience to fulfil their duties, as certificated shares and ’own name’ The purpose of the meeting is: (i) to hours at Naspers’s registered address, Deegan is the individual registered contemplated in regulation 42 of the dematerialised shareholders who wish present the directors’ report and the 40 Heerengracht, Cape Town 8000 auditor of that firm who will Companies Regulations 2011. 112 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Notice of annual general meeting continued

Collectively, they have a such persons, whether they be Special resolutions The reason for and effect of special comprehensive understanding of shareholders or not, as the directors The special resolutions set out on the following pages require the support of at resolutions numbers 1.1 to 1.13 is to financial reporting, internal financial in their discretion deem fit. least 75% of votes exercised by shareholders present or represented by proxy grant the company the authority to pay controls, risk management and 10. Subject to a minimum of 75% of the at this meeting in order to be adopted. remuneration to its directors for their governance processes within the votes of shareholders of the company services as directors. company, as well as International present in person or by proxy at the Special resolutions numbers 1.1 to 1.13 Financial Reporting Standards (IFRS) annual general meeting and entitled The approval of the remuneration of the non-executive directors for the year ending Each of the special resolutions numbers and other regulations and guidelines to vote, voting in favour thereof, the 31 March 2020 (up to 5% increase on fees (excluding value-added tax (VAT)) for 1.1 to 1.13 in respect of the proposed applicable to the company. They directors be authorised and are 31 March 2019 already approved by shareholders at the annual general meeting 31 March 2020 remuneration, will be keep up to date with developments hereby authorised to issue unissued on 25 August 2017), as follows: considered by way of a separate vote. affecting their required skillset. shares of a class of shares already in The board and the nomination issue in the capital of the company 31 March 2020 Special resolution number 2 committee therefore unanimously for cash as and when the opportunity (proposed up to 5% That the board may authorise the recommend Messrs D G Eriksson arises, subject to the requirements increase year on year company to generally provide any and B J van der Ross, and of the JSE Limited (the JSE), including Board (excluding VAT)) financial assistance in the manner Prof R C C Jafta for election to the the following: contemplated in and subject to the audit committee. Their abridged • This authority shall not endure 1.1 Chair* 2.5 times member provisions of section 44 of the Act to curricula vitae appear on pages 59 beyond the earlier of the next a director or prescribed officer of the and 60 of the integrated annual annual general meeting of the 1.2 Member US$199 330 company or of a related or interrelated report. The appointment of the company or beyond fifteen company, subject to (ii) below, or to members of the audit committee (15) months from the date of this All members: Daily fees when travelling to and a related or interrelated company will be conducted by way of a meeting. attending meetings outside home country US$3 500 or corporation, or to a member of separate vote in respect of • That a paid press announcement a related or interrelated corporation, each individual. giving full details, including the Committees pursuant to the authority hereby 7. To endorse the company’s intended use of the funds, will be conferred upon the board for these remuneration policy, as set out published at the time of any issue 1.3 Audit committee: Chair 2.5 times member purposes. This authority shall (i) include in the remuneration report in representing, on a cumulative and also apply to the granting of the integrated annual report on basis within one year, 5% or more 1.4 Member U S $ 49 110 financial assistance to the Naspers share pages 68 to 91, by way of of the number of shares of that incentive scheme, the other existing a non-binding advisory vote. class in issue prior to the issue. 1.5 Risk committee: Chair 2.5 times member group share-based incentive schemes 8. To approve the implementation of • The aggregate issue of any (details of which appear in the the remuneration policy as set out particular class of shares in any 1.6 Member US$29 170 integrated annual report) and such in the remuneration report in the financial year will not exceed group share-based incentive schemes integrated annual report on pages 5% (21 932 802) of the issued 1.7 Human resources and that are established in future 68 to 91, by way of a non-binding number of that class of shares remuneration committee: Chair 2.5 times member (collectively the Naspers group advisory vote. (including securities that are share-based incentive schemes) and 9. To place the authorised but unissued convertible into shares of that 1.8 Member US$34 510 participants thereunder (which may share capital of the company under class). include directors, future directors, the control of the directors and to • That in determining the price at 1.9 Nomination committee: Chair 2.5 times member prescribed officers and future grant, until the conclusion of the next which an issue of shares will be prescribed officers of the company or annual general meeting of the made in terms of this authority, 1.10 Member US$18 600 of a related or interrelated company) company, an unconditional authority the discount at which the shares (participants) for the purpose of, or in to the directors to allot and issue at may be issued may not exceed 1.11 Social and ethics committee: Chair 2.5 times member connection with, the subscription of any their discretion (but subject to the 10% of the weighted average option, or any securities, issued or to be provisions of the Act and the JSE traded price of the shares in 1.12 Member US$25 530 issued by the company or a related or Listings Requirements and the rules question, as determined over the interrelated company, or for the of any other exchange on which thirty (30) business days prior to Other purchase of any securities of the the shares of the company may the date that the price of the issue company or a related or interrelated be quoted or listed from time to is determined. 1.13 Trustee of group share schemes/other company, pursuant to the time, and the memorandum of • That the shares will only be issued personnel funds R53 760 administration and implementation of incorporation of the company), the to ‘public shareholders’ as defined the Naspers group share-based Note unissued shares of the company, on in the JSE Listings Requirements, * The chair of Naspers does not receive additional remuneration for attending meetings, or being a member incentive schemes, in each instance on such terms and conditions and to and not to related parties. of or chairing any committee of the board. the terms applicable to the Naspers Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 113

Notice of annual general meeting continued

group share-based incentive scheme months from the date of passing of A resolution has been passed by the and that special resolution number 4 Ordinary resolution in question (ii) be limited, in respect this special resolution. board authorising the repurchase, and contains all relevant information. 11. Each of the directors of the of directors and prescribed officers, • An announcement will be published confirming that the company and its company or the company secretary to financial assistance in relation to as soon as the company or any of its subsidiaries passed the solvency and Material changes is hereby authorised to do all the acquisition of securities as subsidiaries have acquired N ordinary liquidity test and that from the time Other than the facts and developments things, perform all acts and sign all contemplated in (i). shares constituting, on a cumulative that the test was done there have been reported on in the integrated annual documentation necessary to effect basis, 3% of the number of N no material changes to the financial report and annual financial statements, the implementation of the ordinary The reason for and effect of special ordinary shares in issue prior to the position of the group. Before the except for the purposes of the group’s and special resolutions adopted resolution number 2 is to approve acquisition, pursuant to which the general repurchase is effected, the share-based incentive schemes, there at this annual general meeting. generally the provision of financial aforesaid 3% threshold is reached, directors, having considered the effects have been no material changes in the assistance to the potential recipients and for each 3% in aggregate of the repurchase of the maximum affairs or financial position of the Other business as set out in the resolution. acquired thereafter, containing full number of N ordinary shares in terms company and its subsidiaries since the To transact such other business details of such acquisitions. of the foregoing general authority, will date of signature of the audit report as may be transacted at an annual Special resolution number 3 • Acquisitions of N ordinary shares ensure that for a period of twelve (12) and up to the date of this notice. general meeting. That the company, as authorised by the in aggregate in any one financial months after the date of the notice of board, may generally provide, in terms year may not exceed 20% of the the annual general meeting: Other than repurchasing N ordinary By order of the board of and subject to the requirements of company’s N ordinary issued share shares for purposes of the group’s section 45 of the Act, any direct or capital as at the date of passing of this • The company and the group will share-based incentive schemes, the indirect financial assistance to a related special resolution. be able, in the ordinary course of directors have no specific intention, at or interrelated company or corporation, • In determining the price at which business, to pay their debts. present, for the company to repurchase or to a member of a related or N ordinary shares issued by the • The assets of the company and the any of its N ordinary shares, but believe interrelated corporation, pursuant to company are acquired by it or any of group, fairly valued in accordance that such a general authority should be the authority hereby conferred upon its subsidiaries in terms of this general with IFRS, will exceed the liabilities of put in place in case an opportunity the board for these purposes. authority, the maximum premium at the company and the group. presents itself during the year, which which such N ordinary shares may be • The company and the group’s is in the best interest of the company The reason for and effect of special acquired, will not exceed 10% of the ordinary share capital, reserves and and its shareholders. resolution number 3 is to approve weighted average of the market value working capital will be adequate for G Kisbey-Green generally the provision of financial at which such N ordinary shares are ordinary business purposes. The reason for and effect of special Company secretary assistance to the potential recipients traded on the JSE as determined over resolution number 4 is to grant the as set out in the resolution. the five (5) business days immediately Additional information in respect of the company the authority in terms of the 20 July 2018 preceding the date of repurchase of following appears in the integrated Act and the JSE Listings Requirements Special resolution number 4 such N ordinary shares by the annual report and in the annual financial for the acquisition by the company, Cape Town That the company or any of its subsidiaries company or any of its subsidiaries. statements, and is provided in terms or a subsidiary of the company, of the be and are hereby authorised to • At any point the company may only of the JSE Listings Requirements for company’s N ordinary shares. acquire N ordinary shares issued by the appoint one agent to effect any purposes of the general authority: company from any person whosoever repurchase on the company’s behalf. Special resolution number 5 (including any director or prescribed • The company and/or its subsidiaries • Major shareholders. That the company or any of its officer of the company or any person may not repurchase any N ordinary • Share capital of the company. subsidiaries be and are hereby related to any director or prescribed shares during a prohibited period authorised to acquire A ordinary shares officer of the company), in terms of as defined by the JSE Listings Directors’ responsibility statement issued by the company from any person and subject to the Act and in terms of Requirements, unless a repurchase The directors, whose names appear in whosoever (including any director or the rules and requirements of the JSE, programme is in place where the list of directors contained in the prescribed officer of the company or being that: dates and quantities of shares to be integrated annual report, collectively any person related to any director or traded during the prohibited period and individually accept full responsibility prescribed officer of the company), in • Any such acquisition of N ordinary are fixed, and full details of the for the accuracy of the information terms of and subject to the Act. shares shall be effected through the programme have been submitted pertaining to this special resolution order book operated by the JSE to the JSE in writing prior to the number 4 and certify that, to the best of The reason for and effect of special trading system and done without any commencement of the their knowledge and belief, there are no resolution number 5 is to grant the prior understanding or arrangement. prohibited period. facts that have been omitted that would company the authority in terms of the • This general authority shall be valid • Authorisation for the repurchase is make any statement false or misleading, Act for the acquisition by the company, until the company’s next annual given by the company’s memorandum and that all reasonable enquiries to or a subsidiary of the company, of the general meeting, provided that it shall of incorporation. ascertain such facts have been made company’s A ordinary shares. not extend beyond fifteen (15) 

114 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Form of proxy

Naspers Limited In favour of Against Abstain Incorporated in the Republic of South Africa 5.3 H J du Toit Registration number: 1925/001431/06 5.4 G Liu JSE share code: NPN ISIN: ZAE000015889 LSE share code: NPSN ISIN: US 6315122092 (the company) 5.5 R Oliveira de Lima

104th annual general meeting of shareholders 6. Appointment of the following audit committee members: For use by holders of certificated shares or ’own name’ dematerialised shareholders at the 104th annual general meeting 6.1 D G Eriksson of shareholders of the company to be held on the 2nd floor, Daisy Room, Cape Town International Convention Centre 2 (CTICC2), corner of Heerengracht and Rua Bartholomeu Dias, Foreshore, Cape Town, South Africa on Friday 6.2 B J van der Ross 24 August 2018 at 11:15. 6.3 R C C Jafta

I/We (please print) 7. To endorse the company’s remuneration policy To approve the implementation of the remuneration policy of 8. as set out in the remuneration report certificated being a holder of Approval of general authority placing unissued shares under shares or 9. the control of the directors ’own name’ dematerialised votes, shares of Naspers and entitled hereby 10. Approval of general issue of shares for cash to (see note 1) appoint Authorisation to implement all resolutions adopted at the 11. 1. or, failing him/her, annual general meeting 2. or, failing him/her, or, failing him/her, Special resolution number 1 3. the chair of the annual general meeting as my/our proxy to act for me/us at the annual general meeting, which will be held on the 2nd floor, Daisy Room, Cape Town International Convention Centre 2 (CTICC2), Approval of the remuneration of the non-executive directors corner of Heerengracht and Rua Bartholomeu Dias, Foreshore, Cape Town, South Africa on Friday 24 August Proposed financial year 31 March 2020: 2018 at 11:15 for the purpose of considering and, if deemed fit, passing, with or without modification, the resolutions to be proposed thereat and at each adjournment or postponement thereof, and to vote for or 1.1 Board – chair against the resolutions and/or abstain from voting in respect of the shares in the issued share capital of the 1.2 Board – member company registered in my/our name(s) (see note 2) as follows: 1.3 Audit committee – chair In favour of Against Abstain 1.4 Audit committee – member Ordinary resolutions 1.5 Risk committee – chair 1. Acceptance of annual financial statements 1.6 Risk committee – member 2. Confirmation and approval of payment of dividends 1.7 Human resources and remuneration committee – chair 3. Reappointment of PricewaterhouseCoopers Inc. as auditor 1.8 Human resources and remuneration committee – member To confirm the appointment of M R Sorour as a non- 4. 1.9 Nomination committee – chair executive director 1.10 Nomination committee – member 5. To elect the following directors: 1.11 Social and ethics committee – chair 5.1 C L Enenstein 5.2 D G Eriksson 1.12 Social and ethics committee – member 1.13 Trustees of group share schemes/other personnel funds 

Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 115

Form of proxy continued

Notes to form of proxy In favour of Against Abstain 1. The following provisions shall apply in relation to proxies: Special resolution number 2 1.1 A shareholder of the company may appoint any individual (including an individual who is not a shareholder of the company) as a proxy to participate in, speak and vote at the annual general meeting of the company. Approve generally the provision of financial assistance in terms of 1.2 A shareholder may appoint two or more persons concurrently as proxies and may appoint more than one section 44 of the Act proxy to exercise voting rights attached to different securities held by the shareholder. Special resolution number 3 1.3 A proxy instrument must be in writing, dated and signed by the shareholder. 1.4 A proxy may not delegate the proxy’s authority to act on behalf of the shareholder to another person, other Approve generally the provision of financial assistance in terms of than to the chair. section 45 of the Act 1.5 A copy of the instrument appointing a proxy must be delivered to the company, or to any other person on behalf of the company, before the proxy exercises any rights of the shareholder at the annual general meeting. Special resolution number 4 1.6 Irrespective of the form of instrument used to appoint the proxy: (i) the appointment is suspended at any time General authority for the company or its subsidiaries to acquire and to the extent that the shareholder chooses to act directly and in person in the exercise of any rights as a N ordinary shares in the company shareholder; (ii) the appointment is revocable unless the proxy appointment expressly states otherwise; and (iii) if the appointment is revocable, a shareholder may revoke the proxy appointment by cancelling it in writing or Special resolution number 5 making a later inconsistent appointment of a proxy and delivering a copy of the revocation instrument to the proxy and the company. General authority for the company or its subsidiaries to acquire 1.7 The proxy is not entitled to exercise, or abstain from exercising, any voting right of the shareholder without A ordinary shares in the company direction. 2. A certificated or ’own name’ dematerialised shareholder may insert the names of two alternative proxies of the and generally to act as my/our proxy at the said annual general meeting (tick whichever is applicable). shareholder’s choice in the space provided, deleting “the chair of the annual general meeting”. The person whose name appears first on the form of proxy and whose name has not been deleted and who attends the meeting, The shareholder must provide direction to his/her proxyholder (unless the proxy is provided to the chair); failure to so will be entitled and authorised to act as proxy to the exclusion of those whose names follow. comply will be deemed to authorise the chair to vote in favour of the resolutions. 3. A shareholder’s instructions to the proxy must be indicated by that shareholder in the appropriate space provided, failing which the proxy shall not be entitled to vote at the annual general meeting in respect of the shareholder’s votes exercisable at that meeting, provided where the proxy is the chair, failure to so comply will be deemed to authorise the chair to vote in favour of the resolutions. Signed at……………………………………………. on this …………. day of …………………………….………..2018 4. A shareholder may appoint a proxy at any time. For practical purposes, forms of proxy for Naspers N ordinary shares must be lodged at or posted to the transfer secretaries of the company, Link Market Services South Africa Proprietary Limited, 13th floor, Rennie House, 19 Ameshoff Street, Braamfontein 2001 or PO Box 4844, Johannesburg 2000. Forms of proxy for Naspers A ordinary shares must be lodged at or posted to the registered Signature………………………………… Assisted (where applicable) ………………………………….……….……… office of the company, 40 Heerengracht, Cape Town 8001 or PO Box 2271, Cape Town 8000. Forms of proxy lodged in this manner are to be received by not later than 11:15 on Wednesday 22 August 2018, or such later date if the annual general meeting is postponed to allow for processing of such proxies. All other proxies must be handed to the company secretary prior to the commencement of the meeting. 5. The completion and lodging of this form of proxy will not preclude the certificated shareholder or ’own name’ dematerialised shareholder from attending the annual general meeting and speaking and voting in person at the meeting to the exclusion of any proxy appointed in terms hereof. 6. An instrument of proxy shall be valid for any adjournment or postponement of the annual general meeting, as well as for the meeting to which it relates, unless the contrary is stated therein, but shall not be used at the resumption of an adjourned annual general meeting if it could not have been used at the annual general meeting from which it was adjourned for any reason other than that it was not lodged timeously for the meeting from which the adjournment took place. 116 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Form of proxy Shareholder and corporate information continued

7. A vote cast or act done in accordance with the terms of a form of proxy shall be deemed to be valid despite: Administration and corporate information ADR programme • the death, insanity, or any other legal disability of the person appointing the proxy, or Company secretary Bank of New York Mellon maintains a Global • the revocation of the proxy, or Gillian Kisbey-Green BuyDIRECTSM plan for Naspers Limited. • the transfer of a share in respect of which the proxy was given, unless notice as to any of the above-mentioned MultiChoice City matters shall have been received by the company at its registered office or by the chair of the annual general 144 Bram Fischer Drive For additional information, visit Bank of New York Mellon’s meeting at the place of the annual general meeting, if not held at the registered office, before the commencement or Randburg 2194 website at www.globalbuydirect.com or call Shareholder resumption (if adjourned) of the annual general meeting at which the vote was cast or the act was done or before South Africa Relations at 1-888-BNY-ADRS or 1-800-345-1612 or the poll on which the vote was cast. [email protected] write to: 8. The authority of a person signing the form of proxy: Tel: +27 (0)11 289 3032 8.1 under a power of attorney, or Bank of New York Mellon 8.2 on behalf of a company or close corporation or trust, must be attached to the form of proxy unless the full Registered office Shareholder Relations Department – power of attorney has already been received by the company or the transfer secretaries. 40 Heerengracht Global BuyDIRECTSM 9. Where shares are held jointly, all joint holders must sign. Cape Town 8001 Church Street Station 10. Dematerialised shareholders, other than by ’own name’ registration, must NOT complete this form of proxy and South Africa PO Box 11258, New York, NY 10286-1258 must provide their central securities depository participant (CSDP) or broker of their voting instructions in terms PO Box 2271 USA of the custody agreement entered into between such shareholders and their CSDP and/or broker. Cape Town 8000 South Africa Sponsor Tel: +27 (0)21 406 2121 Investec Bank Limited Fax: +27 (0)21 406 3753 (Registration number: 1969/004763/06) PO Box 785700, Sandton 2146 Registration number South Africa 1925/001431/06 Tel: +27 (0)11 286 7326 Incorporated in South Africa Fax: +27 (0)11 286 9986 Auditor Attorneys PricewaterhouseCoopers Inc. Werksmans Inc. PO Box 1474 Transfer secretaries Cape Town 8000 Link Market Services South Africa Proprietary Limited South Africa (Registration number: 2000/007239/07) Webber Wentzel (in alliance with Linklaters) PO Box 4844 PO Box 61771 Johannesburg 2000 Marshalltown South Africa Johannesburg 2107 Tel: +27 (0)11 630 0800 South Africa Fax: +27 (0)11 834 4398 Investor relations Meloy Horn [email protected] Tel: +27 (0)11 289 3320 Fax: +27 (0)11 289 3026 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information 117

Analysis of shareholders and shareholders’ diary

Analysis of N ordinary shareholders Shareholders’ diary PRICE AND VOLUME Number of Number of Annual general meeting August Size of holdings shareholders N ordinary shares owned Volume Price Reports 1 – 100 shares 59 299 2 025 926 R4 500.00 6 Interim for half-year to September November 101 – 1 000 shares 23 707 7 291 763 5 R4 000.00 Announcement of annual results June 1 001 – 5 000 shares 3 243 7 011 763 4 VOLUME (M) Annual financial statements July 5 001 – 10 000 shares 678 4 824 245 R3 500.00 3 More than 10 000 shares 1 460 417 502 362 Dividend PRICE R3 000.00 88 387 438 656 059 2 Declaration August

R2 500.00 Payment September GEOGRAPHIC SPREAD SHAREHOLDER TYPES 1 Financial year-end March R2 000.00 0 Jul 17 Jan 18 Jun 17 Oct 17 Apr 17 Feb 18 Sep 17 Dec 17 Aug 17 Nov 17 Mar 17 Mar 18 May 17 Volume Price The following shareholders hold 5% or more of the N ordinary issued share capital of the company: % of Number of N ordinary N ordinary Name shares held shares owned

Public Investment Corporation of South Africa 13.72 60 201 787 % % SOUTH AFRICA 41.54 FOREIGN INSTITUTIONS 53.01 Public shareholder spread (N ordinary shares) UK 12.94 DOMESTIC INSTITUTIONS 30.09 To the best knowledge of the directors, the spread of public shareholders in terms of section 4.25 of the EUROPE (excluding UK) 5.71 PRIVATE STAKEHOLDERS/INVESTORS 5.57 JSE Listings Requirements at 31 March 2018 was 97.01%, represented by 88 376 shareholders holding NORTH AMERICA 30.07 DOMESTIC BROKERS 3.08 425 576 963 N ordinary shares in the company. The non-public shareholders of the company comprising ASIA 6.36 EMPLOYEES, ETCETERA 2.74 11 shareholders representing 13 079 096 N ordinary shares are analysed as follows: REST OF THE WORLD 1.26 OTHER 5.51 % of OTHER 2.12 N ordinary Number of issued share N ordinary Category capital shares

Naspers share-based incentive schemes 0.72 3 097 876

Directors 1.49 6 548 894

Group companies 0.78 3 432 326 118 Naspers integrated annual report 2018 Introduction Group overview The Naspers approach Business overview Performance review Governance Financial statements Further information

Naspers voting control structure

Aim Structure A majority of A ordinary shares is held by two companies that together comprise the control structure The aim of the Naspers voting control The issued share capital of Naspers of Naspers. The effective voting interests of these two companies are shown in this diagram: structure is to ensure the continued comprises two classes of shares: independence of the group. When entering foreign countries in the broad • N ordinary shares, that have one media or communications spheres, and vote per share and are listed on the when dealing with regulators, it is critical JSE Limited (the JSE). As at 6% that we give an assurance of our 31 March 2018 there are continuity of identity: in other words, 438 656 059 N ordinary shares Keeromstraat(1) Nasbel(2) that we will not, after we have entered in issue, and 0.38% a territory or secured a licence, be • Unlisted A ordinary shares, that taken over by unknown entities with have 1 000 votes per share, but whom the country or regulator may be have relatively insignificant economic uncomfortable. We believe that this participation. (The dividends 20.77% 33.14 % assurance of independence and declared to A ordinary shareholders continuity is critical for our entry into, are equal to one fifth of the and operation in, many markets. dividends per share to which N ordinary shareholders are entitled.) 49% International As at 31 March 2018 there are Differentiated voting rights and control 907 128 A ordinary shares in issue. structures are commonly used in the media and internet sectors to secure 10 0 % independence and deter raids and efforts to seize control. Many international media and technology companies have differentiated rights or control structures. Some more well-known examples Heemstede(3) include: Schibsted and Tele2 in Norway, Notes Altice in the Netherlands, MTG in (1) Keeromstraat 30 Beleggings (RF) Beperk. Sweden, Daily Mail & General Trust in (2) Naspers Beleggings (RF) Beperk. (3) the United Kingdom, JD.Com and Heemstede Investments Proprietary Limited. Alibaba in China, and Alphabet (Google), Facebook, LinkedIn, 21st Century Fox, News Corporation, Discovery, Liberty Keerom(1) and Nasbel(2) hold such A ordinary shares that together they control more than 50% Global, Snap Inc., Zillow and Zynga in (currently 53%) of the voting rights in Naspers. These two companies exercise such rights in consultation the United States. In recent times many with one another. No other entities are part of the control structure. internet and tech companies in particular have implemented similar structures. Keerom has 2 846 shareholders and its constitutional documents provide that no shareholder is entitled to exercise more than 50 votes regardless of shareholding.

Nasbel has 2 614 shareholders, one of which is Heemstede(3) (which is a subsidiary of Naspers) that holds 49% of the shares in Nasbel.

The board of directors of Keerom and the board of directors of Nasbel operate independently. History The voting control structure has been in place since the original listing of the Naspers group on the JSE more than two decades ago. It was approved by the Naspers shareholders and the JSE and is entrenched in the Naspers memorandum of incorporation. Design and produced by MerchantCantos www.merchantcantos.com Naspers Limited +27 (0)21 406 2121 40 Heerengracht Cape Town 8001 South Africa Integrated annual report 2018 www.naspers.com