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Zeel ad revenue grows by 25.8% in Q3’18

The company posted consolidated revenue of Rs 1,838 crore, up 12.1% on YoY basis. PAT for the quarter was Rs 322.2 crore, up 28.5% from Q3’17

Zee Entertainment Enterprises Limited (ZEEL) reported consolidated revenue of Rs 1,838 crore for the third quarter of fiscal 2018, up 12.1% from the corresponding quarter in previous year. Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) was Rs 594.4crore. EBITDA margin for the quarter was at 32.3%. PAT for the quarter was Rs 322.2 crore, up 28.5% from Q3’17.

Advertising revenue for the quarter was Rs 1,202 crore recording a growth of 25.8%. Adjusted for sports, domestic advertising grew by 30.4% to Rs 1,137.3 crore. On a comparable basis (excluding sports, RBNL and IWPL), domestic advertising revenue grew by 25.7%. International advertising revenue for the quarter was Rs 64.7 crore. The strong advertising revenue growth, though on a low base, was led by the sharp rebound in the advertising spends across categories.

Subscription revenue for the quarter was Rs 501.7 crore. Adjusted for the sale of sports business, domestic subscription revenue grew by 7.5% to Rs 403.6 crore. International subscription revenue stood at Rs 98.1 crore.

Subhash Chandra

Subhash Chandra, Chairman, ZEEL, commented, “It is very heartening to see the rebound in the economy after four quarters. The initiatives taken by the government had some short-term impact on the growth but these measures will strengthen the economy in the long run. Indian M&E sector will be a beneficiary of this growth story as people spend more time and money on consuming entertainment content. ZEEL, with its strong portfolio of entertainment offerings, is well positioned to capitalize on this opportunity.”

Punit Goenka

Punit Goenka, Managing Director & Chief Executive Officer, ZEEL, commented, “We are delighted to deliver a strong operating performance during the quarter. The slower growth in the last four quarters was due to specific events which required advertisers to recalibrate spends. As the impact of these factors is now behind us, ad spends have bounced back strongly and outlook remains encouraging. The recent cut in GST rates across a wide category of products should aid the growth.

Our domestic ad revenue growth of 26% is a testimony to the fact that television continues to remain the most effective medium for brand building. With a dominant time share along with an increasing reach, television will remain an important medium for advertisers in the foreseeable future. On top of this, digital platforms are driving incremental video consumption which represents another growth opportunity for content monetization. Our new digital platform, Zee5, scheduled to be launched in February, will enable us to capture this growth.

The domestic subscription growth for the quarter was at 7.5%. The growth so far has been lower than what we had last year as the content deals with our distribution partners are taking slightly longer to conclude due to litigations regarding the TRAI tariff regulation. Last year we had closed majority of these deals in the second and third quarter. However, this does not have any significant impact on our full year outlook for subscription growth.”

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