Prosus N : Annual report 2022 (PDF)

Improving everyday life

for billions of people through technology

Annual report 2022

annual Prosus

Group overview

Sustainability review

Performance review

Governance

Financial statements

Other information

01

Contents

2022 report

Group overview

1. Group overview
2. Segment overview
3. Chair's review

1. Chief executive's review

1. The world around us

1. Our strategy

1. How we create value
2. The value we created this year

Sustainability review

17 Our approach

1. Engaging with our stakeholders

1. Human capital 25 People
   28 Digital inclusion

1. Manufactured capital 29 Innovation
2. Intellectual capital
   30 Artificial intelligence
   33 Cyber-resilience
   35 Data privacy

1. Social capital
   38 Business culture, ethics and integrity
   41 Community investment

1. Natural capital
   43 Climate action

1. The EU Taxonomy Regulation

Performance review

1. Our performance

1. Classifieds

1. Food Delivery

1. Payments and Fintech

1. Edtech

1. Etail

1. Other: Ventures

1. Other: Naspers Foundry

1. Social and Internet Platforms

1. Tax

1. Choosing the right opportunities and balancing risks

1. Monitoring key risks

Forward-looking statements

This report contains forward-looking statements as defined in the United States Private Securities Litigation Reform Act of 1995 concerning our financial condition, results of operations and businesses. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control and all of which are based on our current beliefs and expectations about future events. Forward-looking statements are typically identified by the use of forward-looking terminology such as 'believes', 'expects', 'may', 'will', 'could', 'should', 'intends', 'estimates', 'plans', 'assumes' or 'anticipates', or associated negative, or other variations or comparable terminology, or by discussions of strategy that involve risks and uncertainties. These forward-looking statements and other statements contained in this report on matters that are not historical facts involve predictions.

No assurance can be given that such future results will be achieved. Actual events or results may differ materially as a result of risks and uncertainties implied in such forward-looking statements.

A number of factors could affect our future operations and could cause those results to differ materially from those expressed in the forward-looking statements, including (without limitation): (a) changes to IFRS and associated interpretations, applications and practices as they apply to past, present and future periods; (b) ongoing and future acquisitions, changes to domestic and international business and market conditions such

Governance

92 Group structure

1. Overview of governance

1. Our board

1. The board and its committees

1. Report of the audit committee

1. Report of the risk committee
2. Report of the sustainability committee
3. Report of the nominations committee
4. Report of the human resources and remuneration committee
5. Remuneration report

1. About this report

Financial statements

146 Consolidated financial statements

1. Notes to the consolidated financial statements

1. Company financial statements

1. Notes to the company financial statements

1. Other information - Independent auditor's report

1. Other information to the company financial statements

Other information

1. Shareholder and corporate information
2. Analysis of shareholders and shareholders' diary
3. Non-IFRSfinancial and alternative performance measures

1. Glossary

as exchange rate and interest rate movements; (c) changes in domestic and international regulatory and legislative environments; (d) changes to domestic and international operational, social, economic and political conditions; (e) labour disruptions and industrial action; and (f) the effects of both current and future litigation. The forward-looking statements contained in this report apply only as of the date of the report. We are not under any obligation to (and expressly disclaim any such obligation to) revise or update any forward-looking statements to reflect events or circumstances after the date of the report or to reflect the occurrence of unanticipated events. We cannot give any assurance that forward-looking statements will prove correct and investors are cautioned not to place undue reliance on any forward-looking statements.

Statement on European Single Electronic Format (ESEF)

This document is the PDF/printed version of the 2022 annual report of Prosus N.V. The

2022 annual report was made publicly available pursuant to section 5:25c of the Dutch Financial Supervision Act (Wet op het financieel toezicht), and was filed with the Netherlands Authority for the Financial Markets in European single electronic reporting format (the ESEF package).

The ESEF package is available on the company's website at www.prosus.comand includes a human-readable XHTML version of the 2022 annual report. In any case of discrepancies between this PDF version and the ESEF package, the latter prevails. The independent auditor's report included in this PDF/printed version relates only to the ESEF package.

2022 report annual Prosus

Group overview

Sustainability review

Performance review

Governance

Financial statements

Other information

02

Group overview

1. Group overview
2. Segment overview
3. Chair's review

8 Chief executive's review

10 The world around us

12 Our strategy

14 How we create value

15 The value we created this year

2022 report annual Prosus

Group overview

Sustainability review

Performance review

Governance

Financial statements

Other information

03

We are a global consumer internet group and one of the larger technology investors in the world

Our purpose

Improving everyday life for billions of people through technology.

What we do

We build leading companies that empower people and enrich communities.

We bring food and more to people's doors…

and more customers to restaurants' kitchens

We put the power to make fast, secure payments in people's hands…

and give them credit options too, often for the first time

We enable people and businesses to buy and sell things quickly, conveniently and safely…

and boost the circular economy by giving items multiple lives

We open up a world of learning…

helping millions of people learn where, when and how they want

As a group, we build useful products for more than two billion customers and help their communities thrive. We empower our teams to develop their skills and build meaningful careers. We create long-term value for our shareholders and our many other stakeholders.

How we do it

Our values underpin our culture.

We build

At heart, we're entrepreneurs. We build leading companies that empower people and enrich communities, improving the daily lives of billions of people. We back local entrepreneurs and teams and we operate and invest in businesses in many of the most exciting markets in the world. Our focus on long-term value creation means that our group is a great place for people to build their careers. We work hard to connect, learn and grow to be the best we

can be.

We deliver

We push for excellence in everything we do. We move fast, adapting quickly to seize opportunities. We agree on clear and ambitious goals and regularly discuss how to beat them. Our reward is hardwired to performance, and depends not just on what we deliver, but also on how we deliver it. Pushing for excellence is good for growth

• growth in our business, growth in our skills, experience and career, and growth for our many stakeholders. It keeps us moving forward.

We're responsible

We matter to the customers and communities that we serve. We strive to maximise our positive impact on society and the planet. Wherever we operate, we hold ourselves to the highest standards, which we set out in our code of business ethics and conduct. We're all responsible for the impact we deliver.

We value each other We believe diversity in our teams and in our thinking delivers better outcomes for all. We work hard to build a culture where everyone's welcome and encouraged to contribute. We create supportive and flexible environments so we can perform at our best. Our views and ideas are considered, and our professional growth is supported. We're empowered to make decisions about our work because we're trusted to do a great job.

2022 report annual Prosus

Group overview

Sustainability review

Performance review

Governance

Financial statements

Other information

04

Group overview

We are a global consumer internet group operating across a variety of platforms and geographies; and are also one of the larger technology investors in the world.

Our group includes some of the best-loved, local consumer internet companies in around 100 countries around the world, spanning the Americas to Asia, Europe to South Africa.

We pursue growth by building leading companies that empower people and enrich communities, across our four core segments of Classifieds, Food Delivery, Payments and Fintech, and Edtech

• plus other online businesses including Etail. From Food Delivery to Classifieds, we invest in and build online platforms where small and medium-sized businesses can reach their customers online, often for the first time.

In addition, our Ventures team continually searches for new waves of growth for the group, backing entrepreneurs who are finding new ways to improve lives through technology. We are also a long-term investor in Tencent, one of the world's leading social and internet companies.

We think global and act local

We aim to build leading companies that create value by empowering people and enriching communities. We have grown by investing in, acquiring, and building leading companies. We typically focus on emerging large consumer trends that are linked to disruptive innovation where we try to identify changes early, invest in and adapt proven business models for the high-growth markets we focus on, and leverage our skills, local knowledge and position to build businesses that are scalable and benefit from local network effects. We believe that our platforms offer customers fast, intuitive and secure environments in which to communicate and conduct transactions. We focus on several markets that we believe present above-average growth opportunities (when compared to mature markets) due to their economic growth prospects, scalability and fast-growing, mobile internet penetration levels.

Our businesses and investments primarily operate in China, India, Central and Eastern Europe, North America, Latin America, Southeast Asia, Africa and the Middle East. We have developed strong brands in these markets. We believe that those global and local brands are an important way for our businesses to differentiate themselves from their competitors, thereby driving organic growth through consumer word-of-mouth. However,

we are impacted by the laws and regulations of the various jurisdictions within these markets, including competition and consumer protection laws, foreign investment restrictions and screening, labour laws, data protection and security regulations, online content and platform regulations, intellectual property (IP) laws and regulations, company and corporate laws, tax laws and regulations, financial services legislation, anti-money-laundering legislation, anti-bribery and anti-corruption laws and sanctions and export controls.

During FY22, we had exposure to Russia through our minority interest in VK and our subsidiary Avito. We announced on 20 May 2022 our decision to exit the Russian businesses.

We are both an operator and an investor

We believe that this combination is complementary and enables enhanced value creation. As an operator, we are able to make smarter investment decisions; as an investor, we support our businesses with the right combination of capital, market knowledge and know-how to succeed. As we operate locally, we benefit from the insights of our local operations and their markets. We gain early views on new emerging models and, as a result, are better positioned to drive organic and inorganic growth and support entrepreneurial and seasoned business leaders.

Concentrating on customers, on thinking about their lives and how best to meet their needs, is a central part of what we do - our purpose to improve everyday lives of billions of people through technology. Across our portfolio, we are building ecosystems with multiple customer touchpoints to improve our customers' experience and retain their loyalty. We align technology and data with key customer needs such as convenience, ease of use, reliability and safety. As with many other key aspects of our business, this is a long-term game. It takes ongoing investment to build the end-to-end capabilities that enable closer, stronger relationships with customers across the ecosystems of our core segments. But in turn, it delivers long-term gain - not least, customer loyalty and more lasting value creation.

The leaders of our businesses are compensated directly on the performance of their divisions, fostering a strong culture of entrepreneurship within our group. We are not tied to a rigid investment philosophy and have the ability to take a long-term view. This means that we are able to support our businesses at every stage of their life cycle and focus on creating value over the long term.

As an investor, we benefit from access to attractive opportunities globally. We have long-standing and successful relationships with prominent internet businesses such as in one of our largest markets, China, through our investment in Tencent.

Currently, the adoption curve for our consumer internet businesses is generally lower in the growth markets (when compared to mature markets). This creates an opportunity for us. Overall, we estimate that approximately one fifth of the world's population uses products and services of businesses that we have built, acquired or invested in. Many of these users use the products and services of more than one of these businesses.

Growth opportunities

We believe that our consumer internet businesses have significant potential for future growth and offer opportunities for an enhanced range of internet transactions and services in the markets in which we operate, as well as possible expansions into new markets. We believe that the increase in demand for our products and services will be driven by several underlying trends, including growth in the following: gross domestic product (GDP); the population growth in the younger demographics and the middle class; and continued growth in mobile and high-speed internet penetration as well as the increasing adoption of new internet-based business models that are disrupting existing traditional business models across a range of different industries.