MUMBAI: Riding high on subscription revenue and a bumper advertising revenue growth, Zee Entertainment Enterprises Limited (Zeel) posted a 40.5 per cent jump in fiscal-third quarter net profit to Rs 1.93 billion from Rs 1.37 billion a year earlier.

Zeel?s operating revenues grew 26 per cent to Rs 9.3 billion in the third quarter from Rs 7.4 billion a year earlier.

"Zeel?s Q3 results are better than market estimates. This is evident on both ad and subscription revenue fronts," said a media analyst.

Ad revenue

Belying the overall slowdown in advertising spending due to a sluggish economy and the subdued festival season in November, Zeel?s advertising revenue grew 28.8 per cent to Rs 5.09 billion from Rs 3.95 billion a year ago.

Advertising contributed to 54 per cent of the company?s total revenue. The d growth was aided by an increase in market share in many of Zeel?s channels.

Subscription revenue

The broadcaster?s subscription revenue in the third quarter ended 31 December stood at Rs 4.09 billion, up 25.6 per cent over Rs 3.26 billion a year earlier. Its domestic subscription revenues in the third quarter grew 33.2 per cent year-on-year to Rs 2.9 billion, while international subscription revenue increased 9.4 per cent year-on-year to Rs 1.13 billion.

The company said subscription revenues are not comparable since the accounting treatment of Media Pro, a distribution joint venture between Star India and Zeel, has changed from the fourth quarter of the previous fiscal.

Zeel?s revenues from other sales and services head which includes syndication sales, play-out and transmission facilities decreased 10 per cent to Rs 197 million in the third quarter from Rs 220 million a year earlier.

Ebitda growth

The broadcaster?s operating profit rose 27.6 per cent to Rs 2.6 billion in the third quarter from Rs 2.04 billion a year earlier. Its operating profit margin in the third quarter was 27.8 per cent while the net profit margin was 20.6 per cent.

Going forward, margins could improve on higher subscriber revenue, lower sports losses and new investments turning around. However, the company would continue to invest on content.

Zee chairman Subhash Chandra said, "Indian economy has been in a vicious circle of slowing growth, high inflation and stalled capex. Advertising spends have been impacted this year due to this slowdown. The first three quarters of this fiscal have been good for Zee with a strong performance relative to the industry and competition. With one quarter to go, we are looking forward to a strong growth this year. The highlight of this quarter has been the strong growth momentum in advertising revenues despite subdued spends. The performance illustrated that our investment in content is yielding good returns. We continue to invest to create compelling content across genres."

Operating cost up

Zeel?s total expenses in the third quarter stood at Rs 6.7 billion, an increase of 26 per cent from Rs 5.38 billion a year earlier.

The company?s operating cost jumped 22 per cent to Rs 4.18 billion in the third quarter from Rs 3.4 billion a year earlier.

Zee?s employee cost rose 22.4 per cent to Rs 895 million in the third quarter from Rs731 million a year earlier, while selling and other expenses jumped 37 per cent to Rs 1.69 billion from Rs 1.23 billion a year earlier.

During the quarter, the company had launched it kids channel ZeeQ besides investing in new programmes along with increased marketing activities.

Zeel MD & CEO Punit Goenka said, " The subscription revenue during the quarter is highest ever and with digitisation roll-out (it) will (further) improve in the medium term.?

?Our network viewership saw a successful mix of new and returning shows. Overall, I am confident about the next 12 months and continue to make further investments in new content and channels. While these new channels will have an impact on the operating margins in the short-term, they will enhance our performance in the medium term,? Goenka said.

Sports business

Zeel?s revenue from sports business in the third quarter was Rs 1.07 billion while incurring an expenditure of Rs 1.16 billion.

In the third quarter of previous year, Zeel?s revenue from sports business was Rs 1.66 billion which included a one-time fee of Rs 700 million on pre-mature termination of the commercial contract with All India Football Federation (AIFF). The company had incurred expenditure of Rs 1.99 billion on sports business a year earlier.

The company expects to contain the sports losses under Rs 1 billion in Fy?13.

The company said it is yet to realise 1.4 billion from the Board of Control for Cricket in India (BCCI) and hence has not been given effect to in the third quarter results.

In November, a three-member Arbitral Tribunal had held the BCCI guilty of "exploiting its dominant position" for arbitrarily terminating its five-year broadcast rights contract with Zee. The tribunal had asked BCCI to pay Zee about Rs 1.4 billion, including the security deposit of Rs 300 million with interest at 11 per cent per annum from 31 May, 2007, for loss of profit and goodwill.

MUMBAI: Subhash Ghai-promoted Mukta Arts has assigned satellite and other electronic rights of its 35 films to Zee Entertainment Enterprises Limited (Zeel) for five years.

Zeel will pay Rs 250 million for the bulk movie purchase deal. The entire amount will be coughed out during the calendar year 2013.

For some of the films, the satellite rights are held by other broadcasters but are in the process of ending their screening window. For these movies, Zeel will be assigned the satellite telecast rights after the term expires.

Mukta Arts said Monday the revenue from the deal with Zeel will be recognised in the Profit & Loss account of the company based on the dates on which the rights commence for each film.

Mukta Arts has produced films like Karz, Hero, Karma, Ram Lakhan, Saudagar, Khalnayak, Pardes, Taal and Yaadein besides some memorable titles like Jogger?s Park, Aitraaz, Iqbal and their most recent Black & White. The company has also produced regional films including Nouka Dubi (Bengali) and Sanai Chaughade (Marathi).

In 2010, Mukta Arts had signed a Rs 200 million deal with Zeel for the satellite rights of its 29 films for five years.

MUMBAI: Zee Entertainment Enterprises (Zeel) is all set to host its annual awards event, Zee Cine Awards 2013, on 6 January at Yash Raj Studios, Mumbai.

The award ceremony will for the first time be simulcast on Zee TV, Zee Cinema, Zing, Zee Marathi, Zee Bangla, Zee Tamil and Zee Telugu. The Red Carpet will air at 7.30 pm on 20 January followed by the main event at 8 pm.

The channel has roped in New Fair & Lovely as the presenting sponsor of the event.

 Zee Cine Awards this year is propagating the rights of the viewers to choose their favourite actor/film with the positioning ?Haq Hai Aapka?. Zee will introduce an innovative and transparent voting mechanism to make the ?Viewers? Choice? proposition of ?Zee Cine Awards 2013? credible and transparent. To ensure this, Zee has empanelled Ernst &Young as a third party to authenticate the voting mechanism. To give the viewer a platform to voice his opinion, Zee has introduced an interactive platform which is a voice portal called ?Zee Connect?.

Zeel MD and CEO Punit Goenka said, ?I?m pleased to announce that the 13th Zee Cine Awards will be held in Mumbai in January. The Awards will be telecast on 20 January 2013 on Zee TV and for the first time will also be simulcast on Zee Cinema, Zing, Zee Marathi, Zee Bangla, Zee Tamil and Zee Telegu. To ensure the authenticity of the voting mechanism for the nominations listed for Zee Cine Awards 2013, we have made the voting system toll free and brought on board Ernst & Young to audit the entire process of voting.?

In the past, Zee Cine Awards has been held in places like Macau, Singapore, London, Mauritius and Dubai.

MUMBAI: Rajesh Jejurikar looked liked a senior executive who could not settle down in the media world. For a man who spent nine years at Marico and over eight years at Mahindra & Mahindra, the innings at Zee Entertainment Enterprises Limited (Zeel) as president was awfully short. Ten months and no media interviews and he rejoins automobile major Mahindra & Mahindra.

Jejurikar had joined Zeel in February this year, getting into a broader role that meant introducing processes and supporting Punit Goenka as the entertainment major was on an expansion drive.

His role involved managing all the key verticals at Zeel, except programming. With his exit now on 31 December, all vertical and department heads of the company will now report into the MD & CEO, Goenka.

Meanwhile, Zee Group has made a high-profile recruitment. Bhaskar Das, who was president at Bennett Coleman & Co Ltd, joined last month as Group CEO with responsibility over digital and news business. Industry outsiders are speculating on him taking an even larger role but Zee has not said anything yet.

Commenting on Jejurikar?s decision to quit, Goenka said, "In a short stint at Zee, Rajesh has brought in newer business perspectives and has contributed to the process immensely, bringing in positive business impact to the organisation. The entire Zee family wishes him all the success in his new endeavours."

Jejurikar added, "The time spent at Zee was extremely fruitful. I am thankful to Zee and Punit for giving me an opportunity to explore and broaden my experience in the media & entertainment space. Zee has all the fundamentals required to become a global media enterprise. As I part ways, and move back to the manufacturing sector, I wish Zee all the success."
 
Jejurikar will join Mahindra as chief executive- Tractor and Farm Mechanisation, with effect from 1 April. In his previous stint at Mahindra, he was chief executive- Automotive Division at Mahindra & Mahindra. He will replace Bishwambhar Mishra, who has moved into a new role at the Mahindra Group, taking over as Director- Mahindra Institute of Quality with effect from 1 April.

Jejurikar will be a member of the Mahindra & Mahindra Group Executive Board (GEB) and will be responsible for the tractor businesses of both the Mahindra and Swaraj brands. In addition, his responsibilities will include MGTL, Applitrac, Construction Equipment businesses and Asset Management (Capital Purchase) for AFS.

Previously Jejurikar was appointed chief executive of the Automotive Division after the formation of AFS in 2010, having joined the organisation as VP - Marketing in the Auto Sector in the year 2000.

MUMBAI: Zeel-owned sports broadcast network Taj Television has renewed its partnership with IMG Reliance for the 18th edition of the Chennai Open as the exclusive official broadcast partner.

Chennai Open, India?s only ATP World Tour stop, will be televised on Taj TV-owned Ten Sports in India. The sports broadcaster will provide comprehensive coverage of the event from 31 December through to 6 January.

Said Ten Sports CEO Atul Pande on the association, ?Tennis has a huge fan following across the region and our association with the Chennai Open will give a fantastic opportunity to millions of tennis fans to experience thrilling tennis action from the comfort of their homes.?

Ten Sports has been a long-standing broadcast partner of Chennai Open.