Demonetisation impacts ZEEL ad revenue for Q3-17

BENGALURU: The Subhash Chandra led content and broadcast player Zee Entertainment Enterprises Limited (ZEEL) reported a small hike of 3.1 percent in advertisement revenue in the quarter ended 31 December 2016 (Q3-17, current quarter) as compared to the corresponding quarter of the previous year (Q3-16). Consolidated revenue from operations (Total Income from Operations or TIO) increased 3.2 percent year-over-year. Though subscription revenue increased 13.7 percent y-o-y, other sales and services declined 35.5 percent and hence pulled down TIO. ZEEL reported consolidated TIO of Rs 1,639.12 crore in Q3-17 as compared to Rs 1,588.12 crore in Q2-16.

Ad revenue in the current quarter was Rs 945.45 crore (58.3 percent of TIO) as compared to Rs 926.39 crore (58.3 percent of TIO) in Q316. Subscription Income in Q3-17 was Rs 593.46 crore (36.2 percent of TIO) and in Q3-16, it was Rs 521.79 crore (32.8 percent of TIO) Other Sales and Services Income in the current quarter was Rs 90.21 crore (5.5 percent of TIO) as compared to Rs 139.94 crore (8.8 percent of TIO) in Q3-16.

ZEEL chairman Chandra said, “Government’s decision to demonetise high value currency had an impact on businesses across sectors. Notwithstanding the short term disruption caused by demonetisation, we believe that it is a step in the right direction. Demonetisation along with implementation of GST and push towards cashless economy would help country’s long term growth.”

ZEEL’s Profit After Tax (PAT) in Q3-17 increased 8.6 percent y-o-y to Rs 250.81 crore (15.3 percent of TIO or margin) from Rs 230.86 crore (14.5 percent margin). Operating Profit (EBIDTA) in the current quarter also increased 19.4 percent y-o-y to Rs 515.79 crore (31.5 percent margin) from Rs 432.16 crore (27/2 percent margin).

Total Expenditure in Q3-17 reduced 2.4 percent to Rs 1,148.23 crore (70.1 percent of TIO) from Rs 1,176.31 crore (74.1 percent of TIO) in Q3-16.

Finance costs in the current quarter reduced 14.7 percent y-o-y to Rs 9.02 crore (0.6 percent of TIO) from Rs 10.57 crore (0.7 percent of TIO) in the corresponding year ago quarter.

Employee benefit expense in Q3-17 increased 13.2 percent to Rs 141.88 crore (8/7 percent of TIO) from Rs 125.34 crore (7.9 percent of TIO) in Q3-16.

The company spent 12.4 percent less towards Advertising and Publicity expense in the current quarter at Rs 104.90 crore (6.4 percent of TIO) as compared to Rs 119.75 crore (7.5 percent of TIO) in Q3-16.

Company speak

Chandra said further, “The result once again demonstrates our commitment towards profitable growth and enhancing shareholders’ wealth. Despite the impact of demonetisation, we have delivered growth in advertising revenues and growth in subscription revenues remained strong. We believe the adverse impact of demonetisation is transient and with a strong portfolio of national and regional channels we are confident of delivering sustainable growth.”

ZEEL managing director and CEO Punit Goenka said, “We are happy to deliver another quarter of strong profit growth in a challenging environment. Despite the impact of demonetisation on our advertising revenues, we have improved our EBITDA margins. This highlights our ability to manage costs to drive profitable growth on a consistent basis.”

Gonka revealed, “Acquisition of broadcasting business of RBNL is in line with our strategy to expand our offering in key genres and focus on regional space. BIG Magic, a comedy channel, will complement our Hindi GEC portfolio. BIG Ganga, the leading Bhojpuri channel, will give us entry into the attractive Bhojpuri market. We are confident that these two channels will benefit immensely from the strength of our network.”

Goenka informed, “The deceleration in our advertising revenue growth during the quarter is largely attributable to demonetisation. Advertisers’ willingness to invest in their brands remains intact. However, the timing of spends has been re-calibrated to an extent to suit the change in dynamics due to demonetisation. As economic situation is normalizing, ad spends have already started moving up from December levels.”

International Business

In its earnings release, ZEEL said that its international business continues to perform strongly driven by global demand for our products. For Q3-17 the international business had total revenue of Rs 253 crore which included Advertisement Revenue of Rs 81.70 crore; subscription Revenue of Rs 111.7 core and  other Sales and Services of Rs 59.6 crore.

Note: (1) The unit of currency in this report is the Indian rupee - Rs (also conventionally represented by INR). The Indian numbering system or the Vedic numbering system has been used to denote money values. The basic conversion to the international norm would be:

(a) 100,00,000 = 100 lakh = 10,000,000 = 10 million = 1 crore.

(b) 10,000 lakh = 100 crore = 1 arab = 1 billion.

(2) All numbers in this report are consolidated unless stated otherwise.

(3) Some of the numbers have been rounded off

Latest Reads
Comedy Central sets pace for ultimate celebration with over 100 hours of non-stop FRIENDS ultra marathon for its 6th birthday

Birthdays and New Years are great occasions to make resolutions for participating in marathons. However, this is one marathon which calls for hanging up your running shoes and grabbing the best spot in front of the telly with a bowl of munchies to keep you going because, for the first time ever in...

Television TV Channels English Entertainment
U Sports launches India's first ever Multi-Platform Multi-Game E-Sports Championship - U Cypher with MTV

The Indian E-Sports scenario is all set for a major revamp as U Sports, one of India’s biggest sports business companies in association with India’s No. 1 Youth Brand, MTV, announces the premiere of their all new month-long championship, U Cypher with MTV. Premiering today, on 19th January, the...

Television TV Channels Sports
TV ownership increased by 14% in 2017: IRS

After a gap of four years, the Indian Readership Survey (IRS), which documents the growth of the media industry, has been released for 2017. The survey methodology was criticised in 2014 and, therefore, was halted for an upgrade. This time, the sample size has been increased by 34 per cent to 3.2...

Television TV Channels Viewership
CNN-News18 launches 'If I Were FM Challenge'

As part of its Budget programming, CNN-News18 is launching the ‘If I were FM Challenge’. The campaign will encourage viewers to contribute their suggestions for the Union Budget. The channel will run an extensive on-air campaign to promote the same.

Television TV Channels News Broadcasting
BBC World News to Broadcast 'China's Chat Girls'

Lele Tao is an internet superstar in China’s $3 billion dollar ‘live streaming’ industry. With more than a million fans she can earn thousands of dollars a day singing, dancing, flirting, or often just chatting into her webcam. Fans buy her virtual gifts which she redeems for cash. In return she...

Television TV Channels News Broadcasting
PKL season 6 and 7 dates announced

The second most watched domestic league in India, Vivo Pro Kabaddi League owned by Mashal Sports and Star India announced the dates of sixth and seventh season.

Television TV Channels Sports
Star Bharat leads Hindi GEC (U+R) in week 2 of BARC ratings

MUMBAI: Star Bharat emerged as the leader in the Hindi GEC (U+R) genre dethroning Zee Anmol according to Broadcast Audience Research Council (BARC) all India data for week 2 of 2018.

Television TV Channels Viewership
BARC week 2: Aaj Tak leads Hindi News in all three markets

MUMBAI: Republic TV continues its leading streak in the second week of the year as well in BARC All India ratings. News Nation stays in the top five chart in week 2 of 2018 in Hindi News Rural market. Aaj Tak tops the chart again in Hindi News Urban market.

Television TV Channels Viewership
Dsport acquires India rights of tri-nation tournament in SL

Discovery’s sports channel Dsport has acquired the exclusive India broadcast rights of Nidahas Trophy 2018, a tri-nation international T20 tournament involving India, Sri Lanka and Bangladesh. The transaction was facilitated by Lagardère Sports, the global marketing consultant of Sri Lanka Cricket...

Television TV Channels Sports

Latest News

Load More

Sign up for our Newsletter

subscribe for latest stories