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MUMBAI:
Reliance Broadcast Network Limited (RBNL) expects to achieve
break-even from its television business on an operating basis
for the fourth quarter of this fiscal.
The
company’s confidence stems from narrowing operating loss
led by a sharp reduction in carriage costs.
“Barring
unforeseen circumstances, the company expects to exit the
current financial year with TV business achieving break-even
at an operating level,” the company said.
RBNL's
operating loss from television business in the first quarter
ended 30 June 2012 was down nearly 55 per cent to Rs 116.93
million from Rs 258.79 million a year earlier.
The
company said the reduction in operating loss was largely on
account of a 70 per cent cut in carriage costs, but did not
specify how much it spent in the quarter on account of the
money paid to multi-system cable operators (MSOs) and direct-to-home
(DTH) companies for carrying their television channels.
Revenue
from the television business in the first quarter was Rs 66.34
million. It is against Rs 18.14 million in the first quarter
of last year, which were initial days for RBNL’s television
business. In the fourth quarter of last year, RBNL’s
television business revenue Rs 103.36 million.
RBNL
operates five channels – three English language entertainment
channels Prime, Love and Spark, a Punjabi language channel
Spark Punjabi, all the four under its joint venture Big CBS
Networks, and Big Magic, a regional general entertainment
channel for the Hindi heartland. RBNL has a 50:50 joint venture
with media conglomerate CBS.
The
television financial results, thus, reflect the 50 per cent
of the JV company Big CBS.
The
operating break even will confine to the current television
businesses of RBNL, a company official said The forecast does
not include RBNL's joint venture with RTL. The company plans
to launch a channel called Thrill through the RTL JV this
fiscal.
RBNL's
consolidated revenue in the first quarter was Rs 557.45 million,
down 25 per cent per cent from Rs 751.72 million a year earlier.
The revenue contraction was on account of a fall in revenue
of radio and television production businesses.
RBNL’s
revenue from the radio business fell 19 per cent to Rs 396.38
million from Rs 494.46 million a year earlier. Its revenue
from production business at Rs 52.79 million in the first
quarter was down 68 per cent from Rs 166.34 million a year
earlier.
The
radio business of RBNL actually slipped into a loss in the
first quarter of 2012-13 with an operating loss of Rs 10.14
million against operating profit of Rs 74 million a year earlier.
In the fourth quarter ended 31 March 2012, the operating profit
from radio business was Rs 91.78 million. The company operates
Big 92.7 radio station.
RBNL
has, however, managed to narrow its consolidated net loss
to Rs 287.04 million from Rs 291.34 million a year earlier.
Its consolidated income from operations plunged 29 per cent
to Rs 526.64 million in the first quarter from Rs 745.30 million
a year earlier, but what helped the company narrow its loss
was nearly halving of direct operational expenses (down 48
per cent) to Rs 268.96 million from Rs 521.12 milion a year
earlier.
RBNL
CEO Tarun Katial said, “RBNL had a satisfactory quarter
in the given environment, backed by product innovation and
optimal cost management. Our key businesses of radio and television
stand to benefit significantly from imminent industry reforms
of Phase III and digitisation, respectively."
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