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Dish TV Narrows The Loss In Q3, FY 2011

EBITDA for the quarter records more than a fourfold increase over the corresponding quarter last fiscal.

Dish TV Narrows The Loss In Q3, FY 2011

EBITDA for the quarter records more than a fourfold increase over the corresponding quarter last fiscal.

BestMediaInfo Bureau | Delhi | January 24, 2011

Dish TV India Limited has reported third quarter fiscal 2011 standalone revenues of Rs. 3749 million, representing 35% growth over the corresponding period last fiscal. The EBITDA for the quarter stood at Rs. 684 million, recording more than a fourfold increase over the corresponding quarter last fiscal. The net loss reduced to Rs. 443 million, compared to Rs. 763 million for the same period last fiscal.

The Board of Directors in its meeting held on Friday, has approved and taken on record the un-audited standalone financial results of Dish TV for the quarter ended on December 31, 2010. Below are a few highlights of the third quarter results:

1. Dish TV achieved more than 9.4 million gross and 7.7 million net subscribers at the end of 3Q FY11, maintaining leadership as the largest DTH player in the Asia Pacific region.

2. Strong subscriber addition and more than 5% YoY increase in Average Revenue per User (ARPU) lead to a 45% growth in subscription revenues of Rs. 3,091 million as compared to the corresponding period last fiscal.

3. Favorable pack mix due to increasing traction in middle level subscription packs over base pack resulted in ARPU growing to Rs. 142 in 3Q FY11 compared to Rs. 135 in the corresponding period last fiscal.

4. Subscriber acquisition cost (SAC) increased marginally to Rs. 2,142 from Rs. 2,083 in the immediately preceding quarter largely due to higher selling and distribution expenses and enhanced box subsidy due to aggressive competition at the acquisition front.

5. Content cost as a percentage of subscription revenue remained at 39%. Average monthly churn was at 0.9% p.m.

Subhash Chandra, Chairman, Dish TV India Limited, said, “India continues to be one of the fastest growing DTH markets in the world and Dish TV remains on track to capitalize on the opportunity. Having consistently garnered an incremental market share above 25% in a six player market, Dish TV’s strategic initiatives have been delivering commendable results.”

“While subscriber numbers have been on the rise, ARPUs in India have always had significant scope for improvement. Dish TV’s initiative to drive ARPUs by industry leading practices has delivered heartening results in a challenging environment.  Despite adding more than 1 million subscribers in the third quarter, Dish TV drove Average Revenue per User to Rs. 142. The recently increased transponder capacity will further enable Dish TV to build on its ability to generate higher revenues by offering a significantly enhanced High Definition bouquet,” he added.

Commenting on the third quarter results, Chandra said, “Dish TV has delivered yet another quarter of encouraging financial results. Its superior quarterly performance is a reflection of its continued focus on operational efficiencies and cost management.”

Jawahar Goel, Managing Director, Dish TV, said, “The third quarter being festival period holds significant potential for leveraging on the burgeoning consumer demand in the country. In line with our expectations, Dish TV registered exceptionally strong growth during this period. Price hike across two popular packs announced towards the end of the preceding quarter along with strategic marketing initiatives resulted in our package mix getting favorably skewed towards higher value packs. We were pleased to see that despite brilliant subscriber growth and marginal increase in subscriber acquisition costs, EBITDA margin reached a new high of 18.2%.”

“Dish TV’s constant emphasis on superior content and on creating an unparalleled viewing experience for the consumer along with world class service has always made it stand apart. The company now has another distinct advantage over competition in the form of a significantly enhanced bandwidth capacity. We look forward to capitalize on this lead by offering a collection of value added services and region specific content along with a significantly enhanced number of High Definition channels. We expect this to translate into substantial gains in revenue and profitability while bringing more value to our subscribers and increasing shareholder return going forward,” he added.

Commenting on the overall performance, Goel said, “It was a strong quarter operationally and we are now close to crossing the hump. Dish TV is just half a million less than the critical 10 million subscriber mark and remains committed to break even at the bottom-line and turn free cash flow positive at the earliest. With recent operational initiatives, margin improvements and cash generation would get further strengthened.”

Dish TV crossed the momentous 9 million subscribers mark in the third quarter. Continuing its subscriber acquisition spree, the company went on to add a record 500 thousand new subscribers on its platform during the month of November ‘10.

During the quarter, Dish TV also announced signing up of a long term contract for additional transponders on Asiasat with ‘Antriksh’. With this, its total transmission bandwidth increased to 648MHz. The new transponders are closely located to the current transponders thus allowing channels beamed from it to be available to existing customers as well.

The increased transponder capacity will enable Dish TV to increase its standard definition channel capacity to over 320 and high definition capacity to over 30 which will be substantially higher than any competing DTH operator in both HD as well as SD transmission. This substantial increase in capacity over competition is likely to be a game changer for Dish TV in the Indian DTH market.

With a last mile reach of more than 9.4 million subscribers, Dish TV offers a transparent new medium for distinct advertising in an otherwise cluttered environment. Further, with television rating measurement agencies increasing the all India digital weightage in their reported markets from around 8% to 15%, advertisers have started looking at DTH as a platform of choice for focused advertisement. To capitalize on this, Dish TV has amplified its focus on advertising revenues as an alternate revenue stream and is poised to materially scale up revenue from advertising going forward.

Sports particularly cricket, continues to drive the category. The impending cricket World Cup and IPL matches are expected to provide similar growth to DTH in the year ahead. Dish TV remains well-prepared, showcasing domestic and international cricket to further enhance its reach amongst sports enthusiasts across the country. It recently added the India - South Africa cricketing series in High Definition on its platform.

Dish TV has been driving the digital revolution in the country and remains focused to maintain leadership and achieve its guided acquisition target along with aiming profitability in the months to come.

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