ZEE clocks satisfactory Q2 FY2015

EBITDA stood at Rs 3,205 million, a growth of 3.2% over the   corresponding period of previous fiscal. PAT for the quarter was Rs 2,270 million. EBITDA margin for the quarter stood at 28.7% and PAT margin was 20.3%

BestMediaInfo Bureau | Mumbai | October 22, 2014

Zee Entertainment Enterprises Limited (ZEE) has reported second quarter FY 2015 (ended September 30, 2014) consolidated revenue of Rs 11,178 million. The consolidated operating profit (EBITDA) for the quarter stood at Rs 3,205 million, recording a growth of 3.2% over the corresponding period of previous fiscal. PAT for the quarter was Rs 2,270 million. The EBITDA margin for the quarter stood at 28.7% and the PAT margin was 20.3%.

Advertising revenues for the quarter were Rs 6,259 million, recording a growth of 7.3% over Q2 FY14. Subscription revenues were Rs 4,245 million for the quarter ended September 30, 2014.

Subhash Chandra

Subhash Chandra, Chairman, ZEE, stated, “The Indian economy has started showing signs of revival post the formation of the new government at the Center. GDP growth rate for the first quarter has been a healthy 5.7%, the highest it has been in over two years. The inflation levels have also started to ease towards more manageable levels. The business sentiment has been improving over past couple of months. We are hopeful that this marks the beginning of a sustained high growth trajectory. We expect the media industry to benefit from this improvement in overall economic environment. TV ad spends are likely to improve and we expect television media industry to grow faster than the recent past.”

Commenting on the results, Chandra said, “Our performance during the quarter reflects the investments that ZEE is making to grow its business and market share. The viewership market share is on an uptrend, which will help us to continue to grow ahead of the market. We will continue to pursue growth opportunities, which would enhance long term shareholder value. We have a strong balance sheet and we are confident that we would benefit from the growth opportunities ahead of us.”

Punit Goenka

Punit Goenka, Managing Director and CEO, ZEE, commented, “Our quarterly performance has been satisfactory. It has been a mixed quarter as far as television industry advertising spends is concerned. Even though the overall economic sentiment was positive during the quarter, it translated into increased advertising spends only during the fag end of the quarter. Our expectation is that advertising spends will continue to increase during the rest of the year. Our performance in the quarter reflects the industry wide trend. On the subscription front, the transition of distribution of channels from MediaPro to Taj Television is now complete and we continue to grow in high single digits. Implementation of digitization in the remaining parts of the country will push the growth momentum further. We have also enhanced our HD offering with the launch of “& Pictures HD”. As a result of our consistent performance, we continue to maintain healthy operating margins.”

Speaking about the outlook for the business, Goenka continued, “Though the digitization deadlines for Phase III and Phase IV have been pushed back, timely implementation would greatly benefit the industry. The proposed move to scrap advertisement cap for FTA channels would be a welcome step for the industry. Also, the rollout of BARC in the near future is expected to enhance the representativeness of the viewership data. Creation and acquisition of excellent quality content remains core to our business and we continue to channelize investments to strengthen this core. We also continue to explore growth opportunities in domestic markets, international markets and in digital space.”

During the quarter, Zee TV recorded a relative share of 18.9% among the top 6 Hindi GECs. The market share was even better in the primetime band, where Zee TV recorded a relative share of 22.1%. Zee TV was the No.2 channel in the genre during the quarter. The channel delivered a weekly average of 18 shows among top 100 shows during the quarter led by the top rated shows like Jodha Akbar, Kumkum Bhagya and Jamai Raja. New shows launched during the quarter were Jamai Raja, Bandhan – Sari Umar Hamein Sang Rehna Hai, Neeli Chhatriwale and India's Best Cine Stars Ki Khoj. New launches planned in the forthcoming quarter include Maharakshak Aaryan, Dil Se Nachein India Wale and DID Super Moms 2 amongst others.

ZEE's Hindi Movie Cluster – Zee Cinema, &pictures, Zee Classic, Zee Premiere and Zee Action – lead the genre with a relative share of 30.9%. The key properties of the channel during the quarter were Double Mazaa, Shanivaar Ki Raat Sitaron Ke Saath and Lage Raho. This quarter saw the premiere of Holiday, Main Tera Hero and Total Siyapaa

ZEE's International operations constitute a significant part of the company's revenues. The highlights of the International Operations during the quarter were as follows: In Americas, Zee TV continued to garner the highest viewership share among South Asian networks. Zee TV and Zee Bollywood were launched on an additional platform - Charter Communications. In UK, the locally developed programme, Zee Companion, continues to consolidate and engage audiences. Zee TV and Zee Cinema continued to be the No. 1 South Asian channels in their respective genres in the UAE. Zee Aflam continued its successful run as the Number 3 movie channel in All Arabs target audience in KSA. Zee Alwan was among the top 10 most watched channels in KSA during the month of Ramadan. In APAC, our recently launched channels Zee Bioskop and Zee Nung have gained popularity within a short period of time and are available on multiple platforms.

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