Naira Decline Stifles Kenyan-Based Mdundo’s Financial Projection

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Mdundo, one of the Africa-focused streaming platforms, has revealed an astounding 239% YoY increase in Premium revenue while noting a 23.2% YoY rise in Monthly Active Users (MAU).

According to its annual report ending June 30, 2023, the company saw substantial growth in Premium revenue; soaring from DKK 7.2 million (equivalent to USD $1.02 million) in the 2021-2022 period to DKK 12.6 million (approximately $1.78 million) in the 2022-2023 period.

Although this falls slightly below its projected range of DKK 13-16 million, the company considers its progress “acceptable”. Several factors have influenced the reported numbers, including the significant decline of the Nigerian Naira in the later part of the fiscal year, as well as a 25% decline in the value of Kenyan Shilling over the year.

Mdundo had partnered with MTN and Airtel Nigeria to offer seamless subscription options for its service, priced at N20 ($0.02) daily and N50 ($0.06) weekly. However, the company remains steadfast in its commitment to Nigeria as one of its key markets alongside Kenya, Tanzania, Ghana, and South Africa. These markets collectively contributed to 15 million out of its total 26.6 million monthly active users (MAUs) in June 2023.

“These key markets encompass a combined population of 422 million people, approximately 35% of Sub-Saharan Africa’s population. They offer substantial growth opportunities due to high internet penetration rates and robust economic development,” it argues.

Mdundo’s Premium revenue now represents 35% of the company’s overall revenue, an increase from 18% in the previous fiscal year. This puts the company on track to meet its goal of attaining a positive EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) by 2025.

Advertising Revenue

Mdundo experienced a 37% year-on-year growth in advertising revenue, going from DKK 6 million (equivalent to USD $850,000) to DKK 8.2 million ($1.16 million). As a result, the company's total revenue is expected to reach DKK 20.8 million ($2.95 million), representing a 75% year-on-year increase.

Monthly Active Users (MAUs)

While Mdundo would not disclose the exact number of Premium subscribers, its total monthly active users (MAUs) reached 26.6 million, surpassing the company's earlier projection of 25 million. This is good progress compared to the 20.3 million MAUs recorded at the end of the preceding fiscal year. Mdundo, however, remains optimistic to reach a milestone of 50 million unique monthly active users (MAUs) by 2025.

The company reported an improved EBITDA loss of DKK -7.7 million, which is a 3.5% improvement from the previous fiscal year. This aligns with their projected range of DKK -7 to -8.5 million.

In conclusion, Mdundo's target audience stands out due to its unique approach to delivering locally relevant services and content. This emphasis on cultural diversity and catering to local preferences is what gives Mdundo a competitive edge over other streaming services in the market.