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