PVR-Inox Q4 ad revenue up 15% (YoY) and down by 26% (QoQ) in FY2024

Delhi: The cinema exhibitor PVR-Inox advertising revenue grew 15% (YoY) in Q1 and reduced by 26% (QoQ) to Rs 100 crore in Q4 of FY2024.

Altogether, the company’s ad revenue grew by 56% in FY2024 from ad revenue figures of FY2023.

The 2024 general elections and T20 Cricket World Cup are likely to weigh on the 1QFY25 movie pipeline, which could lead to lower occupancy. 

Altogether, PVR-Inox reported a consolidated loss after tax of Rs 129.7 crore in the March quarter.

The company, which had posted a consolidated loss after tax of Rs 334 crore in the same quarter a year ago, said it will consider reducing overhead costs, having a leaner organisational structure and monetisation of real estate assets, among other steps as part of four key strategic priorities that have been identified for its growth strategy from a medium- to long-term perspective.

Consolidated revenue from operations in the March quarter stood at Rs 1,256.4 crore. It was at Rs 1,143.2 crore in the year-ago period, PVR-Inox said in a regulatory filing.

The company stated that “Stable occupancies, healthy recovery in advertising revenues, increased risk of rising scale, and the traction of movie releases over OTT platforms continue to be our key monitorables.”

It also remarked that maintaining occupancy and traction in ad revenues amid an increasing threat from deep-pocketed OTT players would remain a key catalyst for growth.

Total expenses for PVR-Inox in the quarter were Rs 1,480.7 crore. The total expenses for PVR last year was Rs 1,364.1 crore a year ago.

For the fiscal year ended March 31, 2024, the consolidated loss after tax was at Rs 32.7 crore. It was Rs 336.4 crore in the year ended March 31, 2023.

In FY24, consolidated revenue from operations stood at Rs 6,107.1 crore. In FY23, it was Rs 3,750.6 crore.

The company said the effective date for the merger of PVR Ltd and Inox Leisure Ltd was February 6, 2023.

Consequently, FY24 results for the company are reported on a merged basis for PVR Inox and are not comparable with the earlier period.

"Significant volatility was observed in box office collections during the year. The quarter ended March 2024 was the weakest quarter of the year," it said.

The company’s reported loss stood at Rs 90.1 crores. EBITDA stood at Rs 1.2 crore due to an increase in movie distribution expenses, print charges and other expenses, partially offset by a decrease in movie exhibition costs. 

Its consolidated revenue in the fourth quarter grew 10% to Rs 1,260 crore, its ticketing revenues grew 6% YoY to Rs 640 crore. F&B revenues grew 17% YoY to Rs 409 crores. 

According to the company’s statement, Devyani International and PVR Inox would ink a strategic partnership and shall invest in the equity share capital of the proposed company in the ratio of 51:49, to incorporate a new company for the development and operation of food courts situated within shopping malls in India.

The company added 33 new screens across six properties in Q4 FY24. It operates 360 cinemas with 1,748 screens across 112 cities in India and Sri Lanka. 

Currently, it has 1,748 screens in 360 cinemas across 112 cities in India and Sri Lanka.

PVR INOX said it has identified four key strategic priorities for its business that will "act as guiding posts for our growth strategy from a medium- to long-term perspective".

The first will be improving profitability of existing circuit through revenue enhancement by driving box office initiatives like 'Movie Passport', 'Cinema lovers day', screening of alternate content like film festivals, live concerts, key sporting and other events.

Second, the company said it will focus on reducing costs by renegotiating rentals for operational cinemas, shutting down underperforming cinemas, reducing overhead costs and having a leaner organisational structure.

The company will adopt a 'Capital Light' model wherein in its endeavour to reduce annual capital expenditure by exploring alternate models like FOCO (franchisee owned, company operated) and partnering with developers for jointly investing in new screen capex as the third priority.

The fourth priority is to become net debt free over the next few years, it said, adding, "in this context, we are also evaluating monetisation of real estate assets owned by the company and using the proceeds to reduce leverage".

"The key strategic priorities as envisaged above, should help the company in charting a new, less capital intensive and incrementally profitable growth path. Our endeavour is to redefine our growth strategy, focus on fixed cost reduction thus improving profitability resulting in enhanced return on capital and free cash flow generation," PVR INOX Managing Director Ajay Bijli said.