Sahara One deeper in red in Q2-2015; cancels content MOU with Trilogic

Updated: 20 November 2014 (2:00 PM)

BENGALURU: The board of directors of Sahara One Media and Entertainment Limited (Sahara One) had decided on 11 November 2014 to terminate the MoU entered into on 21 May 2014 with Triologic Digital Media (trilogic) for sale of TV contents etc., in terms of letter dated 16 August 2014 received from Triologic. This decision was conveyed by the company to the bourses today. Sahara One had earlier entered into a MOU with Trilogic for purchase of content from the company and to appoint the company as sole entity to seek, appoint and engage production houses for producing programme contents.

"Only the content MoU has been terminated, which was the logistical documental exercise between Sahara One and Triologic. The management outsourcing is still with us and we continue to run Sahara One and Filmy and all the teams continue reporting into us and we continue running the programming, distribution, sales and marketing of Sahara One and Filmy," informs Triologic promoter and director Vishal Gurnani. 

With the termination of the content MoU, Sahara One and Filmy will no longer purchase content from Triologic. "We will purchase it directly from the production houses. The channel still continues to be run by us," clarifies Gurnani.

Sahara One reported less than half (1/2.4 times) Income from operations (TIO) for Q2-2015 at Rs 9.38 crore as compared to the Rs 22.61 crore in Q2-2014 and 16.2 per cent lower than the Rs 11.19 crore in Q1-2015. HY-2015 TIO also fell to less than 1/2.4 times at Rs 20.56 crore from Rs 50.02 crore in HY-2014.

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

The company’s loss in Q2-2015 was Rs 10.36 crore as compared to a profit of Rs 4.1 crore in Q2-2014 and loss was more than four times (4.5 times) the Rs 2.32 crore in Q1-2015. Loss in HY-2015 was Rs 12.67 crore versus a profit of Rs 5.31 crore in HY-2014.

Sahara One’s Total Expenditure (TE) in Q2-2015 at Rs 20.33 crore (216.8 percent of TIO) was 7.1 percent higher than the Rs 18.99 crore (84 per cent of TIO) and 34.6 per cent more than the Rs 15.10 crore (135 per cent of TIO) in Q1-2015. TE in HY-2015 at Rs 35.43 crore (172.3 percent of TIO) was 25.5 per cent lower than the Rs 47.53 crore (95 per cent of TIO) in HY-2014.

A major portion of TE in Q2-2015 was decrease in inventory – this reduced by Rs 10.96 crore versus an increase of inventory by Rs 3.64 crore in the corresponding quarter of last fiscal and reduction of inventory of Rs 0.97 crore in Q1-2015. Inventory reduced by Rs 11.93 crore in HY-2015 versus an increase of inventory by Rs.1.91 crore in HY-2014.

The company’s purchase of content cost fell to one third at Rs 5.26 crore (56.1 per cent of TIO) in Q2-2015 as compared to the Rs 17.51 crore (77.4 per cent of TIO) in Q2-2014 and was 46.8 per cent lower than the Rs 9.90 crore (88.5 per cent of TIO) in Q1-2015. Purchase of content cost in HY-2015 was 1/2.6 times at Rs 15.26 crore (74.2 per cent of TIO) from Rs 39.23 crore (78.4 percent of TIO) in HY-2014.

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