Business Context and Reporting Period
Company: Anghami Inc.
Filing Type: Form 20-F (Annual Report)
Reporting Period: Fiscal year ended December 31, 2024
Business Overview: Anghami is a leading multimedia streaming platform in the Middle East and North Africa (MENA) region, offering music (Anghami app) and premium video (OSN+ app). In April 2024, the company completed a strategic transaction with OSN Streaming Limited, integrating OSN+ video streaming into its operations. OSN Streaming Limited now holds a majority stake (approximately 55%) in Anghami.
Key Financial Metrics
| Metric | 2024 (USD) | 2023 (USD) | Change |
|---|---|---|---|
| Total Revenue | 78,093,405 | 41,380,440 | +88.7% |
| Cost of Revenue | 102,116,216 | 31,088,542 | +228.5% |
| Gross Profit (Loss) | (24,022,811) | 10,291,898 | Turned Negative |
| Operating Loss | (62,139,512) | (14,557,807) | Worsened |
| Net Loss | (63,592,548) | (15,665,634) | Worsened |
| Cash and Cash Equivalents | 14,140,792 | 6,231,685 | +127% |
| Free Cash Flow | (48,855,959) | (5,119,981) | Worsened |
Segment Performance:
- Subscriptions: Revenue grew 164.7% to $65.0M, driven by the inclusion of OSN+ (9 months of consolidation). However, the segment incurred a gross loss of $27.5M due to fixed video content costs.
- Advertisement: Revenue grew 13.3% to $11.2M. Gross margin declined to 33.7% from 61.1% due to increased barter transaction costs.
- Live Events: Revenue declined 72.8% to $1.9M due to limited activity and the impact of regional conflicts.
Material Changes vs. Prior Period
- OSN+ Integration: The primary driver of financial changes was the April 1, 2024, consolidation of OSN+. This added significant fixed content costs ($77.4M total content costs in 2024 vs. $14.4M in 2023) and technology infrastructure costs, outweighing the revenue contribution in the first nine months.
- Subscriber Growth: Total subscribers increased 95.4% to 3.37 million, and Active Users grew to 22.4 million, largely due to the addition of the OSN+ user base.
- Currency Impact: Significant devaluation of the Egyptian Pound (approx. 40% in 2024) negatively impacted revenue in Egypt, the company's largest market. Foreign exchange losses decreased to $1.0M in 2024 from $2.7M in 2023.
- Convertible Notes: The company issued $12M in convertible notes to OSN Streaming in December 2024 (with an additional $20M drawn in February 2025) to support liquidity.
Guidance, Outlook, Risks, and Unusual Items
Outlook and Strategy: Management focuses on scaling the OSN+ video segment to achieve economies of scale, leveraging cross-platform synergies between music and video, and growing digital advertising. The company expects continued investment in content and technology.
Material Risks:
- Going Concern: The auditor has raised substantial doubt about the company's ability to continue as a going concern due to accumulated losses of $202.5M and negative working capital. Operations depend on the ability to raise additional funding.
- Internal Controls: The company identified material weaknesses in internal controls over financial reporting, including lack of skilled personnel for IFRS/SEC reporting and ineffective IT general controls. Remediation is ongoing but not yet complete.
- Content Costs: High fixed costs for video content and minimum guarantees for music licenses create margin pressure if user growth does not meet expectations.
- Geopolitical Risk: Operations in the MENA region face risks from regional instability, currency devaluation (Egypt, Lebanon), and the impact of conflicts (e.g., Gaza) on advertising and live events.
- Listing Status: Shares were transferred to the Nasdaq Capital Market in February 2025 due to failure to meet the $1.00 minimum bid price requirement of the Global Market.
Investor Verification Checklist
- Liquidity Runway: Verify the sufficiency of the $14.2M cash balance against the $48.9M negative free cash flow and the timeline for the remaining $23M convertible note drawdown.
- Internal Control Remediation: Monitor progress on fixing material weaknesses in financial reporting and IT controls to ensure future financial accuracy.
- OSN+ Unit Economics: Assess the timeline for the video segment to reach profitability given the high fixed content costs and current negative gross margin.
- Currency Hedging: Evaluate the company's strategy to mitigate further devaluation risks in Egypt and Lebanon.
- Shareholder Dilution: Review the terms of the OSN Streaming convertible notes and warrants, which could result in significant dilution if converted.