TV18’s topline up 7% YoY; Q4 FY17 operating profits at Rs 92.6 cr

TV18 Broadcast has posted consolidated revenues of Rs 2,677 crore (including proportionate share of Joint Ventures) in FY17, a 7 per cent YoY growth, driven by entertainment and national news. Segment profits were impacted by investments in new initiatives in regional and digital, and a pullback in advertising spends in the latter half of the year. However, adjusted for the investments in new initiatives and one-time expenses, segment profits at Rs 308 crore were up 30 per cent YoY. 

The consolidated revenue (including proportionate share of JVs considered for segment reports) for the fourth quarter ended March 31, 2017 stood at Rs 715.4 crore, compared to Rs 669.3 crore in the corresponding quarter last year. The FY17 consolidated revenue stood at Rs 2676.9 crore, up 7 per cent from Rs 2494.8 crore last year. 

Segment Profit before Interest and Tax on a consolidated basis, including the performance of JVs for Q4 FY17 stood at Rs 22.1 crore, as against Rs 96.7 crore in the corresponding quarter last year. Excluding the impact of new initiatives and one-time expense, the segment profit for the quarter is Rs 92.6 crore. 

The consolidated revenue as per Ind-AS (accounting the JVs under Equity method) for the quarter ended March 31, 2017 stood at Rs 278.9 crore, compared to Rs 301.6 crore in the corresponding quarter last year. The FY17 consolidated Ind-AS revenue stood at Rs 979.4 crore, up 6 per cent from Rs 924.9 crore last year. 

Operating profit on a consolidated basis under Ind-AS for Q4 FY17 stood at Rs 26.4 crore, as against Rs 91.6 crore in the corresponding quarter last year. Excluding the impact of new initiatives and one-time expense, the operating profit for the quarter is Rs 60.9 crore. 

Commenting on the results, Adil Zainulbhai, Chairman, Network18, said, “The last year has been a period of flux for the media industry, and a tale of two-halves. Despite headwinds in the later part of the year, we have continued to grow. Our commitment to growth is visible in our continued investments into Regional and Digital – the two growth axes we believe shall shape the future of media in India.” 

Highlights for the quarter 

Tepid ad-industry environment dragged revenues, especially in regional markets. The media industry is still facing impact of deferment of advertising spends that kicked-in from November-December 2016 on likely slowdown in consumer spending. Further, the revival of advertising spends has been witnessed at a much faster clip for national channels, while regional markets are still recovering with a lag. This has been exacerbated by our launches of regional news and entertainment channels over the last 18 months, including 4 in early-FY17. 

Despite headwinds, TV18’s consolidated topline (including JVs) grew 7 per cent YoY and its operating profits, excluding impact of new initiatives, was Rs 92.6 crore, compared to Rs 96.7 crore in the last quarter.

Viewership around key events demonstrated the network’s News franchise leadership. CNBC TV18, during the live coverage and analysis of the Union Budget on February 1, 2017, garnered 86 per cent market share. On Counting Day of the Assembly Elections of 5 states, CNN News18 was the #1 English News channel. 

Viacom18 continues to showcase its strength in Hindi General Entertainment, Regional entertainment and Kids genres. Colors is now a strong #2 channel, while Nick and Sonic together place us as the top Kids content provider today with a ~29 per cent market-share. Free-ToAir movie channel Rishtey Cineplex (launched in early FY17) has also garnered an 8 per cent viewership-share in a highly fragmented genre. 

Amidst a challenging market environment, the group continued to focus on scaling up its digital and regional platforms. OTT entertainment app Voot continues to gain traction, and we are witnessing more sticky usage patterns than competition. The network’s second Kannada GEC Colors Super has gained a 6 per cent market-share within a year of launch. The overall regional News bouquet has also witnessed a surge in viewership share during the quarter, led by our in-depth coverage of state elections. 

New initiatives and one-time charges 

The aggregate operating loss of the new initiatives of Viacom18 (second Kannada GEC Colors Super, OTT video destination Voot and movie channel Rishtey Cineplex) considered in the consolidated segment results for the quarter is Rs 36.1 crore. 

Three regional news channels – News18 Kerala, News18 Tamil Nadu and News18 Assam/N.E – that were launched during the first quarter of the current year incurred an operating loss of Rs 26.9 crore during the quarter. 

fyi TV18, the lifestyle programming channel from the AETN18 stable (a JV between TV18 and A&E Network), commercially launched in July 2016, gained a market share of 21 per cent in the quarter. The channel incurred an operating loss of Rs 7.6 crore during the quarter. 

TV18 owns and operates the largest network of channels – 47 in India, spanning news and entertainment. In addition to this, the network also caters to the global Indian diaspora through 11 international channels.

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