Dish TV narrows net loss, raises forecast

MUMBAI: Dish TV, the market leader in the direct-to-home (DTH) business, expects to be cash positive this fiscal as subscription revenues pick up and it starts benefitting from economies of scale.

The company has posted a revenue of Rs 10.85 billion for the fiscal ended 31 March 2010, an increase of 48 per cent over the previous year, with subscription income swelling each quarter to end at Rs 8.35 billion for the year.

"Subscription revenues are expected to rise to around Rs 12 billion this year. Dish TV can leverage its increase in revenue and pay back interest," a media analyst who closely tracks the company said on request of anonymity.
Dish TV has a debt of around Rs 9.5 billion and expects to reduce it from this fiscal‘s fourth quarter.

The company‘s net loss for the year narrowed to Rs 2.61 billion, as against Rs 4.76 billion a year ago. The fourth quarter net loss is down to Rs 597.73 million, compared to Rs 786.68 million in Q4 of FY‘09.

Backed by growth in subscribers and gross sales, operating revenues of the company jumped to Rs 3.03 billion for the fourth quarter, a 46 per cent growth as compared to Rs 2.07 billion in the corresponding period of the previous fiscal.

Dish TV chairman Subhash Chandra said, “Dish TV’s performance demonstrates the underlying strength of its subscription business and the company’s ability to manage costs effectively, both of which have led to positive operating profits for the fiscal. An innovative business approach with an eye on operational efficiencies has resulted in Dish TV delivering encouraging numbers and the company crossing the Rs 10 billion mark in revenues this year. With the DTH industry in India witnessing unprecedented growth, the year ahead promises to be even better for Dish TV.”

Dish TV mopped up 1.8 million new subscribers in FY‘10 as compared to 2.06 million added during the previous fiscal, mainly because of price war and competition with players like Sun Direct, Airtel Digital TV and Big TV. For the fourth quarter, Dish TV added 0.44 million subscribers. 
The company’s gross subscriber base stood at 6.9 million while the net subscriber base as on 31 March 2010 stood at 5.7 million.

"Dish TV is in a position to mop up 2.5 million subscribers this fiscal as it is a year filled with major sporting events including the T20 World Cup, the soccer World Cup, the Commonwealth Games and the ICC World Cup," the analyst said.

The expenses for the quarter, which include subscriber related expenses, employees and administrative cost, stood at Rs 3.53 billion, up from Rs 2.67 billion in the corresponding quarter of the previous year.

Dish TV‘s ARPU (average revenue per user) stood at Rs 138 for the year, lower than the previous fiscal‘s figure of Rs 143. For the fourth quarter, the ARPU was at Rs 138, compared to Rs 135 in the previous three-month period. "It looks like the ARPU is bottoming out," said the media analyst.

Dish TV‘s financial performance reflects the strength of an integrated business model. “We have been steadily targeting break-even at the operational level. Game changing innovations for subscriber acquisition and brand building along with focus on customer satisfaction have helped us continue as the largest DTH player in the India,” said Dish TV managing director Jawahar Goel.

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