Network18 reports its highest ever full-year consolidated EBITDA at Rs 1,080 cr

Network18 reported its highest ever full-year consolidated EBITDA at Rs 1,080 crore; while Q4 2022 EBITDA was at Rs 266 crore. The consolidated margin for FY22 was reported at 18.4% (+145 bps YoY), showing four years of continuous improvement. News business (TV and Digital) delivered a sharp improvement in annual profitability, even as Entertainment business maintained strong margins despite a step-up in investments.

FY22 revenues saw a 25% increase, revenues driven by a strong growth in advertising; however, subscription revenue was flattish as NTO 2.0 implementation remained mired in legal challenges.

Viacom18 has forayed into the sports genre and launched three dedicated sports TV channels in April 2022. Viacom18 also announced a partnership with Reliance and Bodhi Tree Systems in April 2022 to accelerate its growth journey.

Highlights for Q4FY22

• 15% growth in operating revenue driven by movies business and ad revenue growth
• TV News revenue grew 10% YoY and margin was at 21.4%
• Entertainment business revenue grew 11% YoY and margin was at ~16%
• Digital News revenue grew 32% YoY and margin was at ~8%

Highlights for FY22

Consolidated margins rose to 18.4%, highest ever, despite intermittent COVID impact

Highest ever operating profit at Rs 1,080 crore (+36% YoY), driven by robust financial performance of all three verticals - TV News, Entertainment and Digital News

TV News margins expanded by ~500bps to ~21% with strong revenue growth and continued cost controls providing operating leverage

Entertainment business maintained margins at strong 18%+, despite a substantial 26% YoY increase in operating costs

Digital News saw a sharp turnaround in profitability driven by growth in ad revenues

Rs 838 crore profit after tax (PAT), up 53% YoY, despite impact of Rs ~140 crore higher tax provision

Viacom18 partnership with Reliance and Bodhi Tree 

On April 27, 2022, Viacom18 announced a strategic partnership with Reliance and Bodhi Tree Systems (a platform of James Murdoch’s Lupa Systems and Uday Shankar). As part of this partnership, Rs 15,145 crores will be infused by Bodhi Tree Systems (Rs 13,500 crore) and Reliance (Rs 1,645 crore) through Reliance Projects & Property Management Services Limited, a wholly-owned subsidiary of Reliance).

In addition, the JioCinema OTT app (currently owned by RPPMSL) will be transferred to Viacom18.

Paramount Global (formerly known as ViacomCBS), a leading global media and entertainment company comprised of iconic content studios, TV networks and streaming services, reaffirmed its commitment to the partnership as a strategic partner in Viacom18. It will continue to supply Viacom18 its premium global content as well as launch Paramount+ in India in partnership with Viacom18.

This partnership between Reliance, Paramount Global and Bodhi Tree Systems, will enable Viacom18 to transform into one of the largest TV and digital streaming companies in India.

Foray into sports

Viacom18 has forayed into sports genre and scaled-up its offering with addition of marquee properties During the year, Viacom18 acquired television and digital rights to some of the marquee sports properties like NBA and FIFA World Cup, two of the most watched sports in the world. It also acquired the rights of major footballing leagues – La Liga (Spain), Serie A (Italy) and Ligue 1 (France), Cinch Premiership (Scotland), and other sporting events like ATP Masters, Tennis, WTA, top BWF World Tour events like All England Open Badminton Championship, World Boxing Championship, Abu Dhabi T10 Cricket, and Road Safety World Cricket Series, among others.

The network launched 3 sports channels (including 1 FTA channel) last month under the umbrella brand, Sports18, giving the fans a dedicated destination for watching their favourite sports content on TV, in addition to streaming on digital platform, Voot.

Viacom18 believes that sports, especially live sports, will help strengthen the value proposition of the network to consumers and will complement the current entertainment offering. The network will continue to add more events and properties to its catalogue and will strive to be India's most-coveted sports network by providing fans easy access to a comprehensive bouquet of international and premium sports content. 

Commenting on the performance, Adil Zainulbhai, Chairman, Network18, said, “FY22 was a remarkable year, not only from the perspective of numbers, but in terms of building a strong foundation on which the business can continue to grow for the foreseeable future. The financial performance has vindicated our decision of investing in new businesses a few years ago which have started showing encouraging positive results. In a similar vein, we have set ourselves an ambitious target to become a leading player in the digital space while strengthening our core TV offering. We will continue to solidify our ‘Digital First, TV Always’ proposition, leveraging our existing strengths to grow in segments where we are present and breaking ground in new markets with new and innovative offerings.”

He further said, “The strategic partnership we have struck for Viacom18 is a big step in this direction which will help set the Company on a long-term growth trajectory and create one of India’s leading content company.”