Zee News Ltd's Q4 Ebitda stays strong, slips into net loss due to Akash Bangla

MUMBAI: Zee News Ltd (ZNL) has slipped into net loss in the fiscal-fourth quarter due to an old investment made in Akash Bangla, but its Ebitda has stayed healthy and beat forecast expectations.

ZNL has provided for Rs 166.7 million towards diminution in value of strategic investments and provision for doubtful advance share application money given to Akash Bangla. ZNL holds around 18 per cent stake in Akash Bangla, the Bengali infotainment channel.

The company has posted a consolidated net loss of Rs 39.51 million for the three-month period ended 31 March 2012 compared to a net profit of Rs 66.49 million a year ago. In the trailing quarter, ZNL’s consolidated net profit stood at Rs 99.7 million (after minority interest), even as its advertising revenue had degrown marginally compared to the year-ago period.

Ebidta for the quarter rose to Rs 184.1 million from Rs 138.3 million, representing a 33 per cent increase. Margins stood at 21.3 per cent.

The company’s net sales from operations climbed to Rs 859.81 million for the quarter, an increase of 13.8 per cent over the year-ago period.

ZNL CEO Barun Das said, “We have come out of the economic slowdown stronger than most. Our focus on ad revenues from non-traditional streams has helped us post a better growth compared to the industry which is expected to stay flat or show early single digit growth.

ZNL’s advertising revenue stood at Rs 562.9 million, up 0.4 per cent YoY. Subscription revenue grew 8.1 per cent QoQ to Rs 208.3 million on better collections by Media Pro.

“The real growth in subscription revenues was higher as they were booked net of expenses which were necessitated due to formation of Media Pro, which pays subscription revenues to Zee net of expenses,” ZNL said.

The company reported fourth quarter consolidated revenues of Rs 863.6 million, an increase of Rs 104.42 million over the earlier year. Revenue from other sales and services was at Rs 92 million. This mostly includes the value of inventory of programmes and films of Zee Tamil transferred to Zee Entertainment.

The company’s total expenses for the quarter under review rose 9.4 per cent to Rs 679.5 million as against Rs 620.9 million a year ago.

Cost of operations went up from Rs 159.85 million to Rs 200.8 million even as employee benefits cost remained flat at Rs 176.42 million compared to Rs 174.14 million in the corresponding quarter of the same fiscal.

The revenues for Zee News, Zee Business, Zee 24 Taas, Zee Punjabi, and 24 Ghanta grew at 15.5 per cent for the quarter to Rs 822.3 million from Rs 711.8 million, with Ebidta margins of 28.1 per cent.

The new business loss for the quarter came down to Rs 47 million for the last quarter from the loss of Rs 108.2 million in the same period last year due to discontinuance of Zee Tamil.

Subsequent to discontinuance of Zee Tamil, the company has transferred part of inventory of programmes and films related the channel to Zeel of Rs 198.47 million for FY’12.

Full fiscal performance

ZNL has posted consolidated full-fiscal revenue of Rs 3072.2 million, an increase of 11 per cent over the earlier year.

Advertising revenue grew 2.2 per cent to Rs 2 billion during the fiscal while subscription revenue rose just one per cent to Rs 742.7 million.

Total expenses rose 8.3 per cent to Rs 2.54 billion on account of increase in cost of good & operations and employee cost increasing 19.5 and 7.5 per cent to Rs 703.7 and Rs 744.8 million respectively.

Commenting on the results, Das said: "Our Ebidta has stayed strong. We continue to be committed to long term growth in all aspects of business. Being on a healthy growth path post demerger of GECs, a series of strategic initiatives are on the cards which will be implemented in due course of time.”

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