Q2-2015: ZEEL reports 7 per cent growth in ad revenue

BENGALURU: The Subhash Chandra led content and broadcast player Zee Entertainment Enterprises Limited (ZEEL) reported a 7.3 per cent hike in advertising revenue in Q2-2015 at Rs 625.94 crore versus the Rs 583.30 crore in the corresponding quarter of last year and a negligible 0.6 per cent more than the Rs 622.10 crore in Q1-2015. The company?s ad revenue in HY-2015 reported at Rs 1248.04 crore is 12.1 per cent more than the Rs 1133.37 crore in HY-2015.

Note: 100,00,000 = 100 Lakhs = 10 million = 1 crore.

According to the company, due to mandatory accounting changes necessitated by change in content aggregator regulation by TRAI, the current quarter?s subscription and TIO figures can?t be compared with the figures of last year.  

ZEEL?s subscription figures stood at Rs 424.45 crore in Q2-2015 with domestic subscriptions of Rs.337.3 crore and international subscription figure at Rs 87.2 crore. Subscription figures for Q1-2015 was Rs 412.13 crore while Rs 458.12 crore for Q1-2014. HY-2015 subscription revenue has been reported at Rs 836.58 crore versus Rs 882.19 crore in HY-2014.

The company reported PAT at Rs 227 crore (20.3 per cent of Total Operating Revenue or TIO) in Q2-2015 which is 7.8 per cent more than the Rs 210.57 crore (19.4 per cent of TIO) in Q1-2015 crore and 3.9 per cent less than the Rs 236.31 (21.5 per cent of TIO) crore in Q2-2014. HY-2015 PAT at Rs 460.18 crore (21.2 per cent of TIO) was 5.3 per cent more than the Rs 437.04 crore (21.2 per cent of TIO) in HY-2014.

Let us look at the other Q2-2015 and HY-2014 reported by ZEEL

The company reported other sales and services income (other income) of Rs 67.43 crore in Q2-2015, which is 3.24 times the Rs  20.83 crore in Q1-2015 and 12.7 per cent more than the Rs 59.86 crore in Q2-2014. Other income announced by the company for HY-2015 at Rs 88.26 crore was 11.8 per cent more than the Rs 78.97 crore in HY-2014.

ZEEL?s TIO in Q2-2015 is at Rs 1117.82 crore versus Rs 1085.70 crore in Q1-2015 and Rs 1101.28 crore in Q2-2014. In HY-2015, the company reported Rs 2172.88 crore TIO and Rs 2074.53 crore for HY-2014.

The company?s Total expenditure (TE) for Q2-2015 at Rs 810.75 crore was 1.8 per cent more than the Rs 796.10 crore in Q1-2015 and 1.4 per cent more than the Rs 799.89 crore in Q2-2014. For HY-2015 TE was 5.8 per cent more at Rs 1576.21 crore as compared to the Rs 1490.31 crore in HY-2014.

Q-o-q, the company?s operating cost went up 8.4 per cent to Rs 470.03 crore in Q2-2014 from Rs 434.02 crore. The operating cost for this quarter was 6.7 per cent lower than the Rs 504.11 crore in Q2-2014. HY-2015 operating cost is 4.5 per cent lower at Rs 873.68 crore versus Rs 914.87 crore in HY-2014.

Employee Benefit Expense (EBE) for Q2-2015 announced at Rs 107.96 crore was 3.4 per cent less than the Rs 111.71 crore in Q1-2014 and 8.8 per cent more than the Rs 99.19 crore in Q2-2014. EBE for HY-2015 at Rs 219.67 crore was 12.8 per cent more than the Rs 194.82 crore in HY-2014.

ZEEL chairman Subhash Chandra said, ?We expect the media industry to benefit from the improvement in the overall economic environment.  TV spends are likely to improve and we expect television media industry to grow faster than the recent past.?

Commenting on the second quarter earnings,  ZEEL managing director and CEO Punit Goenka said, ?It has been a mixed quarter as far as television advertising is concerned. Even though overall economic sentiment was positive during the quarter, it translated into increased advertising spends only during the fag end of the quarter.  Our expectation is that advertising spends will continue to increase during the rest of the year. Our performance in the quarter reflects the industry wise trends.?

 ?On the subscription front, the transition of distribution of channels from MediaPro to Taj Television is now complete, and we continue to grow in high single digits,? he added.

Click here for Financial Statements

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