For the third quarter of FY19, Zee Entertainment Enterprises (Zeel) reported consolidated revenue of Rs 21,668 million, a growth of 17.9% YoY. Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) was Rs 7,543 million with an EBITDA margin of 34.8%. PAT for the quarter was Rs 5,624 million.
Advertising revenue for the quarter was Rs. 14,626 million, a growth of 21.7% YoY. Domestic advertising revenue grew by 20.6% YoY to Rs 13,719 million. International advertising revenue was Rs 907 million.
Subscription revenue for the quarter was Rs 6,185 million, a growth of 23.3% YoY. Domestic subscription revenue grew by 28.6% YoY to Rs 5,192 million. International subscription revenue was Rs 993 million.
While reported earnings look good, all eyes will be on proposed promoter stake sale. In November 2018, Zee Entertainment's promoter (Essel Group) announced their intention to sell up to 50% of their around 42% stake to a strategic partner by March-April, most likely a global player.
Subhash Chandra, Chairman, Zeel, commented, “India is poised to remain one of the fastest growing economies in the world. The decline in crude oil prices and rationalisation of GST rates will further boost the economy and help maintain the growth momentum in consumption. Even in M&E space, content consumption is growing at a brisk pace across mediums. This trend along with macroeconomic tailwinds will drive growth in both advertising and subscription revenues. We have delivered yet another quarter of strong performance across all our businesses. Zee5 is scaling up in line with our expectations and is on course to become India’s number one digital entertainment platform.”
Punit Goenka, Managing Director & CEO, Zeel, commented, “I am pleased with our performance this quarter which further strengthens our position as India’s leading entertainment content company. While our television business continues to consolidate its number one position, Zee5 is quickly establishing itself as one of the leading digital entertainment platforms in the country. Zee5 has already become the biggest producer of Indian content amongst the digital platforms, and the content offering will multiply going forward. Our expanding list of partnerships with telecom operators and players in the digital eco-system, coupled with innovation in pricing, will make Zee5 accessible to a wider audience.”
Zee5 continues its strong growth recording 56.3 mn MAUs in the month of December, a growth of 36% over the last 3 months.
“With the launch of our Malayalam channel, Zee Keralam, Zeel now has the widest footprint in the country in terms of the languages covered. It will help us further consolidate our network share. Advertising outlook for the industry looks upbeat and we aim to outpace the industry growth on the back of our growing network share. After much delay, TRAI’s tariff order is now set to be implemented across the country next month. I reiterate that this is a positive step for the industry in the long term and will be beneficial for everyone. While it will take some time for the new system to settle, we are working with all our partners for its smooth implementation,” added Goenka.