Zeel net profit down 38.2% despite 24.9% growth in revenues

For the second quarter of fiscal 2019, Zee Entertainment Enterprises Limited (Zeel) reported consolidated revenue of Rs 19,759 million, growth of 24.9% YoY. The growth was driven by the strong performance of our domestic broadcast business and aided by other businesses.

Advertising revenue for the quarter was Rs 12,106 million, growth of 22.7% YoY. Domestic advertising revenue grew by 23.3% YoY to 11,526 million. International advertising revenue for the quarter was Rs. 580 million.

Subscription revenue for the quarter was Rs 6,082 million, growth of 21.3% YoY. Domestic subscription revenue grew by 26.0% YoY to Rs 5,093 million. International subscription revenue was Rs 989 million.

EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) for the quarter grew by 37.6% to Rs 6,757 million and EBITDA margin stood at 34.2%

Net profit after tax for the quarter was Rs 3,867 million, down 38.2% from the corresponding quarter of previous year. The company had reported profit of Rs 6,255 million.

Subhash Chandra

Subhash Chandra, Chairman, Zeel, commented, “Media and entertainment industry around the world is going through some seminal changes and India is no different. Digital has opened new possibilities for content creators and multiplied the entertainment choices consumers have at their disposal. As India’s leading entertainment content company, Zeel is strongly positioned to capitalize on this new growth opportunity. Our deep understanding of the Indian consumers will be as instrumental in helping us become the leader in the digital space as it was in helping us achieve the leadership in television. In a short time, Zee5 has received an overwhelming response and I am confident that the platform will continue to scale-up going forward.”

Punit Goenka

Punit Goenka, Managing Director & CEO, Zeel, commented, “Zee5 is the fastest growing entertainment platform in the country. In a little over six months, it has become the second most popular OTT platform. With a monthly active user base of 41 million and an average daily time spend of 31 minutes, it is growing faster than our expectations. Despite the strong initial performance, I believe it is just the beginning of a long digital journey for us. With a strong pipeline of original content and partnerships with key players in the digital eco-system, we are confident that Zee5 will become the default entertainment platform for digital audience.

Our broadcast business continues to grow at an impressive pace as evident from the domestic advertising and subscription revenue growth numbers. We continue to consolidate our viewership share which is driving our market leading growth. We believe that our broadcast portfolio has the potential to further increase its market share and the launch of new channel in Kerala will surely help it. The advertising and subscription revenue growth will be aided by the scaling-up of digital business and the growth outlook for both remains strong. This robust performance also gives us room to increase our investments in digital, if required.”

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