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FY-2015: Tepid box office, World Cup Cricket chop PVR profits

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BENGALURU: Impacted by poor movie content and World Cup Cricket towards the end of FY-2015 (year ended 31 March, 2015, current year) Indian motion picture exhibition, production and distribution house PVR Limited reported just 23.1 per cent PAT at Rs 11.64 crore as compared the Rs 50.39 crore in FY-2014.

PVR, in its earnings release, says that there was a 12 per cent drop in the footfalls in Q4-2015 at 1.22 crore and that its entertained one per cent lesser patrons (5.92 crore) in FY-2015 and profit could have been lower but for strong performance of its Food and Beverages (F&B) revenues and Sponsorship income.

Note: 100,00,000 = 100 lakh = 10 million = 1 crore

All numbers are consolidated unless stated otherwise

The company’s Q4-2015 performance has been poor. PVR’s Movie Exhibition segment revenue dropped 4.3 per cent in Q4-2015 to Rs 271.40 crore as compared to the Rs 283.69 crore in Q4-2014 despite the company adding 50 more screens spread over nine properties in FY-2015. Also, Q4-2015 movie exhibition segment revenue was 30.9 per cent lower than the Rs 392.88 crore in the immediate trailing quarter. The movie exhibition segment has reported an operating loss of Rs 14.68 crore in Q4-2015 as compared to operating profits of Rs 18.99 crore of Rs 50.08 crore in Q4-2014 and Q3-2015 respectively. PVR’s movie exhibition revenue in FY-2015 at Rs 1370.31 crore was 9.1 per cent more than the Rs 1255.59 crore in FY-2014. The segment reported 28.2 per cent lower operating profit of Rs 88.23 crore in the current year as compared to the Rs 122.87 crore in FY-2014.

In Q4-2015, PVR’s net Total Income from Operations excluding other income (TIO) at Rs 299.55 crore was 4.5 per cent lower than the Rs 314.23 crore in the corresponding year ago quarter and 28.6 per cent lower than the Rs 419.71 crore in Q3-2015. TIO in FY-2015 at Rs 1481.34 crore was 9.6 per cent more than the Rs 1351.23 crore in FY-2014.

PVR reported a loss of Rs 35.56 crore in Q4-2015 as compared to PAT of Rs 0.74 crore in Q4-2014 and PAT of Rs 31.59 crore in the immediate trailing quarter.

PVR’s EBIDTA in FY-2015 also suffered on this account. EBIDTA including other income in the current year at Rs 209.67 crore (14.2 per cent margin) declined six per cent as compared to the Rs 222.99 (16.5 per cent margin) in FY-2014. EBIDTA including other income in Q4-2015 at Rs 12.71 crore (4.2 per cent margin) was almost a third (down 63.9 per cent) of the Rs 35.18 crore (11.2 per cent margin) and a little more than one seventh (15.3 per cent margin) of the EBIDTA including other expenses of Rs 82.23 crore (19.8 per cent margin) in the previous quarter.

Let us look at the other numbers reported by PVR

PVR’s Total Expenditure (TE) in FY-2015 at Rs 1393.11 crore (94 per cent of TIO) in FY-2015 was 13.2 per cent more than the Rs 1230.22 crore (91 per cent of TIO) in FY-2014. TE in Q4-2015 at Rs 314.12 crore (104.86 per cent of TIO) was 0.5 per cent lower than the Rs 315.58 crore (100.43 per cent of TIO) and 14.9 per cent lower than the Rs 369.33 crore (88 per cent of TIO) in Q3-2105.

The company’s Film Exhibition Cost in FY-2015 at Rs 342.18 crore (23.1 per cent of TIO) was 3.9 per cent more than the Rs 329.49 crore (24.4 per cent of TIO) in FY-2014. Film Exhibition Cost in Q4-2015 at Rs 62.96 crore (21 per cent of TIO) was 8.2 per cent lower than the Rs 68.6 crore (21.8 per cent of TIO) in Q4-2014 and 36.1 per cent lower than the Rs 98.49 crore (23.5 per cent of TIO) in the previous quarter.

PVR’s cost of Food and Beverages consumed (F&B cost) in FY-2015 at Rs 107.38 crore (7.2 per cent of TIO) was 16.3 per cent more than the Rs 92.31 crore (6.8 per cent of TIO) in FY-2015. F&B cost in Q4-2015 at Rs 21.05 crore (seven per cent of TIO) was 2.9 per cent lower than the Rs 21.67 crore (6.9 per cent of TIO) in Q4-2014 and 30 per cent less than the Rs 30.05 crore (7.2 per cent of TIO) in Q3-2015. PVR says that F&B revenues increased 17 per cent in FY-2015 as compared to FY-2014.

The company’s movie production segment (movie segment) in FY-2015 reported 35.9 per cent growth in revenue at Rs 51.23 crore as compared to the Rs 37.71 crore in FY-2014. Movie segment revenue in Q4-2015 at Rs 13.61 crore was 28.3 per cent lower than the Rs 18.99 crore in Q4-2014 and 14.9 per cent more than the Rs 11.85 crore in Q3-2015. The segment reported operating profit of Rs 2.74 crore as compared to an operating profit of Rs 0.90 crore in FY-2014. Operating profit of PVR’s movie production segment in Q4-2015 was Rs 1.54 crore as compared to an operating loss of Rs 0.56 crore in Q4-2014 and an operating profit of Rs 0.43 crore in Q3-2015.

PVR’s Others’ (including Bowling, gaming and restaurant services, etc) segment reported almost flat revenue (down 0.1 per cent) in FY-2015 at Rs 73.96 crore as compared to the Rs 74.02 crore in FY-2014. Revenue from ‘Others’ segment in Q4-2015 at Rs 17.27 crore was 9.9 per cent less than the Rs 19.16 crore in Q4-2014 and 9.1 per cent less than the Rs 19 crore in Q3-2015. The ‘Others’ segment reported slightly higher operating loss of Rs 2.80 crore in FY-2015 as compared to the Rs 2.63 crore in FY-2014. Operating loss of the segment in Q4-2015 at Rs 1.46 crore was higher than the operating loss of Rs 0.96 crore in Q4-2014 and the operating loss of Rs 0.13 crore in Q3-2015.

Assuring stakeholders of a better FY-2016, PVR chairman and managing director Ajay Bijli said, “While Q4-2015 performance stood tepid, with the consumer sentiment coming back Q1-2016 box office have been very strong with movies like Fast & Furious 7, Avengers, Gabbar, Piku and Tanu Weds Manu leading the pack. Going forward we have Dil Dhadakne Do, Jurassic World and ABCD-2 releasing in June followed by Bajrangi Bhaijaan, a Salman Khan starrer and Drishyam in July. The content pipeline looks pretty promising and hopefully the worst in terms of content should be behind us and we expect a blockbuster 2015-16.”

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