|
An official press release states that the company continued on
its solid path of growth and profitability despite the fact that
the company had posted a loss of Rs 141.05 million for the fiscal
ended 31March 2002.
The profit before tax during third quarter of fiscal 2002 rose
to Rs 52.7 million as against Rs 1.5 million for the corresponding
quarter last year. The increase in profits is mainly due to improved
channel operations showing 50 per cent growth in total revenues
and a simultaneous decrease of 30 per cent in overall cost during
the period. During the quarter the company has re-negotiated its
contract with satellite provider, effective from 1 December, resulting
in more than 25 per cent saving in transponder cost.
The total revenue for the nine months ended 31 December 2002 stands
at Rs 315.7 million as compared to Rs 233 million achieved during
the corresponding period last year. The profit before tax has surged
to Rs 142.2 million as compared to Rs 17.6 million achieved during
the corresponding nine months period.
The good results are attributed to improvement in the company's
efficiency after its merger with media major Zee Telefilms. In February
2002, Zee had proposed to acquire 48.38 per cent of the share capital
of ETC for a consideration of Rs 178.4 million. The members of ETC,
at the extra-ordinary general meeting (EGM) in end-March 2002, then
approved the issue of up to 22,20,812 equity shares of Rs 10 each
for a cash at a premium of Rs 21.52 per share aggregating Rs 6,99,99,994
(Rs 31.52 per share of ETC) to Zee Telefilms on preferential allotment
basis.
The deal was a win-win situation for both companies. The companies
now have less competition in two categories - the music and Punjabi
segments. Also, the deal implied that Zee could enhance its bouquet
of channels giving it more clout with cable operators. This opened
another revenue stream for the channel network, as well. This should
prove beneficial to ETC and Zee in the long run.
Zee has already started working on ETC so as to improve the latter's
operational performance through better network synergies and lowering
of overheads. ETC channels now have access to the large pool of
resources of Zee in India and abroad. Both companies are in the
process of effecting synergies between operations. This will also
include content, copyrights of films and songs, marketing and sales
network internationally.
ETC will be able to augment its revenue streams by content syndication
and subscriptions from overseas markets especially for its most
prestigious and valuable property 'Gurbani'. All these will have
a direct and immediate impact on revenues and bottom line of ETC
and benefit its stakeholders. This has already been visible from
the ETC's current performance.
The ETC channel was launched in June 1999 as a 24-hour Indian music
channel with the punch line of "Aakhir Dil Hai Hindustani".
The company graduated from a music channel to a wholesome family
entertainment channel.
ETC Punjabi was launched in June 2000. Within a short span of three
months, ETC Punjabi became the No.1 Punjabi channel amongst stiff
competition from other three channels of its genre. ETC Punjabi
has bagged exclusive rights to telecast "Gurbani" Live
from the Golden Temple, Amritsar.
A press release states that ETC has started exploiting its existing
programmes in overseas markets using Zee's existing international
platform. In the UK, a separate channel has been launched in the
name of "Alpha ETC Punjabi" by Zee UK. Gurbani and ETC
programmes are forming major part of the programming of that channel.
Transfer pricing norms between ETC and international entities of
Zee have been fixed and accounted for during the quarter ended 31December
2002.
A release states that the company's channels ETC Punjabi and ETC
(Music) continued to command a lion's market share in their respective
genre during the quarter under review. ETC Punjabi has dominated
its market by taking 65 per cent market share among all Punjabi
channels. ETC (Music) continued to maintain its market leadership
with 40 per cent market share among the music channels in India.
All of the top 25 programmes of Punjabi channels are from ETC Punjabi
while ETC (music) channel enjoys 15-20 programmes out of the top
25 programmes (as per
TAM).
As on September 2002, promoters held 51.01 per cent, while the
public, institutions and foreign bodies held 14.78 per cent, 11.37
per cent and 5.49 per cent respectively in the equity capital of
ETC Networks.
|
