Positive sentiments give a strong boost to DB Corp’s Q2 FY2022 revenues

DB Corp, home to flagship newspapers – Dainik Bhaskar, Divya Bhaskar, Divya Marathi and Saurashtra Samachar – has seen an increase in its Total Revenue for the second quarter ended September 30, 2021 at Rs 4,513 million, as against Rs 3,498 million in Q2 FY2021. Advertising and circulation revenues, too, had grown to Rs 3,029 million and Rs 1,159 million, respectively.

Highlights of the company’s operational and financial performance are as follows:

The efforts of the Dainik Bhaskar group on resumption of circulation to pre-COVID-19 levels have yielded stellar results with various initiatives having contributed to the restoration of almost 9295% of pre-COVID-19 circulation copies along with cover price increase in select markets. Further, these efforts have resulted in expanding market share gains, with an average increase of around 2-3% YOY across all markets in which the Group operates, underscoring the resilience of the group. The Dainik Bhaskar Group is well positioned to expand its market share further, owing to its superior offering, a well-oiled and efficient distribution network and strong trade connections.

The economic activity across the country has seen strong acceleration with the expansion of vaccination drive and declining COVID-19 active cases. There are strong tailwinds being generated across sectors with the festive season adding to the country's economic resurgence. As this pent-up demand fructifies, advertisers are once again putting their trust in Print Media, which has been the most credible medium, to maximise their returns on ad spends. As a result, demand for print advertising space is witnessing an upsurge. Advertising in large format, such as gatefolds, covers, and full pages, are making a strong comeback. Non-metros, where Dainik Bhaskar operates in, continue to remain at the forefront of current economic recovery.

Advertisement revenues are reclaiming pre-COVID-19 levels with the festive season providing an added push and as a result, our print business advertising stands at 82% of the pre-COVID-19 levels, that is, Q2 FY2020, despite the absence or muted performance of large categories such as Auto and Consumer Durables. All other sectors, such as Real Estate, Education, BFSI, Healthcare, Retail and newer categories such as e-commerce and start-ups, are inundating the advertising space across our newspapers. Local advertising, which constitutes almost 70% of the overall advertising, is currently growing by almost double digits. The momentum of mega issues continued in the quarter gone by with all editions being completely sold out and some creating history in terms of the single day revenues that were generated from ad sales.

Well implemented cost optimisation, operating leverage and increased revenues have aided in improving the operating margins with 200 basis points expansion YOY, despite disruptions led by the second wave of COVID-19. We have been working towards and are well on progress to achieve almost 55%-60% of last year’s operating costs savings of Rs 195 crore. The EBITDA for the Print Business in Q2FY22 came in at Rs 1,219 million (with an EBIDTA margin of 29%) as against Rs 873 million in Q2 FY21 (with an EBIDTA margin of 27%).

Performance highlights for Q2 FY2022

Advertising Revenue stood at Rs 3,029 million as against Rs 2,263 million, on a comparative higher base of last year

Circulation Revenue stood at Rs 1,159 million as against Rs 1,033 million

Total Revenue came in at Rs 4,513 million as against Rs 3,498 million

EBIDTA stands at Rs 1,054 million (23% margin) as against Rs 745 million (margin of 21%), aided by stringent cost control measures and despite large digital business investment for future growth

Net Profit stands at Rs 538 million as against Rs 285 million

Radio business:

Advertising Revenue at Rs 287 million versus Rs 182 million

EBIDTA stands at Rs 87 million versus Rs 27 million

Performance highlights for H1 FY2022

Advertising Revenue stood at Rs 4,742 million as against Rs 3,333 million

Circulation Revenue stood at Rs 2,265 million as against Rs 1,961 million

Total Revenue came in at Rs 7,592 million as against Rs 5,655 million

EBIDTA stood at Rs 1,105 million as against Rs 467 million

PAT stood at Rs 315 million as against Net loss of Rs 195 million

Radio Business:

Advertising Revenue at Rs 443 million versus Rs 262 million last year

EBIDTA / (Operating loss) at Rs 85 million versus Rs 34 million

Digital Business

Since the start of 2020, DB Corp has been steadily growing its Daily Active user base on its Apps. According to the latest Comscore results, the Dainik Bhaskar App monthly users have increased by approximately 7x since the beginning of 2020, owing to high-quality content development and a highly tailored product experience. With this, the company has achieved a significant lead and stand as a dominant #1 Hindi and Gujarati News Apps player, while continuing to be on-course to further increase its user base and leadership position.

Some of the key areas of initiatives by the company to spearhead growth include human resource with fresh new digital team, investment in original news, technology up gradation for super-fast digital apps speed, and editorial strategy of hyper local news with increasing use of videos. DB Corp has also created a world class digital advisory board and has recently added Mark Thompson, former CEO of New York Times (NYT), to its Advisory Board. Thompson had overseen the entire digital transformation of NYT over the last decade closely and will be advising DB Corp exclusively in the Indian market.

Commenting on the Q2 FY 2022 performance, Sudhir Agarwal, Managing Director, DB Corp Ltd, said, “With the pandemic creating a sombre environment in the past few quarters, we are pleased that the cloud of despair seems to have been lifted with a strong wave of positive sentiments flowing in. We had always expected a good recovery, but the robust momentum that we are witnessing in our key Tier 2, 3 and beyond markets is truly encouraging.”

Agarwal further said, “With this broad-based recovery, we have not only crossed our performance of last year, but are on track to reach our performance of 2019 or before the pandemic started. This, we believe, is a testament to our well-thought-out strategy, editorial integrity, and continued leadership position in the markets we operate in, making us natural partners for our advertising clients, and importantly, the first choice in newspapers for millions of readers across the country.”

“As our digital footprint expands, we hope to be able to capture the mind-space of our readers across Print as well as Digital mediums. We will continue to strive for our stakeholders and are excited to go into the second half of the year with strong momentum,” he added.