The company reported consolidated revenue of Rs 1,540.3 crore for the first quarter of fiscal 2018
Leading global content company, Zee Entertainment Enterprises Ltd (Zeel), reported a 16% year-on-year rise in the April-June quarter net profit at Rs 251.6 crore.
The company reported consolidated revenue of Rs 1,540.3 crore for the first quarter of fiscal 2018.
Calling implementation of goods and services tax (GST) as a big step towards formalisation of the Indian economy, Dr Subhash Chandra, chairman, Zeel, said, "This will help plug leakages in the system, and the long-term benefits from this initiative will further drive the growth rate of the Indian economy. Strong economic growth and increasing share of formal sector bode well for advertising spend growth."
Advertising revenues for the first quarter stood at Rs 966.5 crore. Adjusted for the sale of sports business and consolidation of RBNL, domestic advertising revenues, which grew 6.9% on year, contributed Rs 868.8 crore while international Rs 57.8 crore. Adjusted for the sale of sports business, domestic subscription revenue grew by 14.5% to Rs 378.8 crore while international subscription revenue stood at Rs 100 crore. Earnings before interest, tax, depreciation and amortisation (Ebitda) for the quarter was Rs 484.4 crore and Ebitda margin stood at 31.4%.
Punit Goenka, managing director and chief executive officer, Zeel, said it was a yet another satisfying quarter with a strong financial and operating performance. "During the quarter, we recovered from the impact of demonetization and the growth in the first two months was strong. However, the momentum was disrupted in June in the run-up to GST implementation.
"The advertisers reduced ad spends on existing brands and launched fewer products as distribution chain was not fully prepared for a seamless transition to the new regime. Despite the challenge, our domestic ad revenue grew by 7%. Notwithstanding the short-term impact, we believe that GST will aid the advertising spends in the long-run," Goenka said.
On its domestic subscription revenue, he said, "While there is still uncertainty regarding the implementation of the new tariff regulation due to pending litigations, we are confident of driving the subscription business on the back of the strong competitive positions of our channels in the key genres."
During the June quarter, Zeel also acquired the balance 49% stake in India Webportal (IWPL), which is the third-ranked online content publisher in the country. It operates a suite of websites focusing on different genres including news, sports and entertainment.
"Being one of the fastest growing digital networks, it gives us an opportunity to reach and understand digital consumers through its various offerings. The acquisition is part of our strategy to strengthen the digital presence," said Goenka.
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