Zee Entertainment Enterprises Ltd (ZEEL), India's leading entertainment company, reported a 43.5% year-on-year increase in net profit for the October-December quarter at Rs 306.5 crore. Advertising revenues at Rs 742.6 crore were up 8.5% over the December quarter of 2014.
Zee Entertainment Enterprises Ltd (ZEEL), India's leading entertainment company, reported a 43.5% year-on-year increase in net profit for the October-December quarter at Rs 306.5 crore. Advertising revenues at Rs 742.6 crore were up 8.5% over the December quarter of 2014.
Commenting on the results, Subhash Chandra, chairman, ZEE, said the company's performance reflects the investments it is making to grow the business and market share.
"The viewership market share has been strong, which has helped us to continue to grow ahead of the market. We will continue to pursue growth opportunities, which would enhance long-term shareholder value. We have a strong balance sheet and we are confident that we would benefit from the growth opportunities ahead of us," Chandra said.
Of the overall subscription revenues of Rs 446.1 crore, domestic revenues grew 4% on-year to Rs 345.5 crore while the balance came from international subscriptions. While consolidated operating revenues for the quarter stood at Rs 1,363.7 crore, operating profit (Ebitda) at Rs 353.3 crore increased 21.5% over third quarter last fiscal. The company maintained a healthy Ebitda margin at 25.9%, while PAT margin stood at 22.5%.
Punit Goenka, managing director and CEO, ZEE, said the television industry has had a good quarter as far as advertising spends were concerned.
"The festive season saw robust growth though it got moderated slightly after the festivals were over. We had a good quarterly performance, reflecting the industry-wide trend. On the domestic subscription front, we grew in low double digits during the quarter. However, on a sustained basis, we are growing in the high single digits. Implementation of digitisation in the remaining parts of the country will push the growth momentum further. As a result of our consistent performance, we continue to operate at a healthy operating margin," Goenka said.
The quarter, according to the company, saw a lot of activity on the subscription front with broadcasters testing the a-la-carte pricing model, which will test the true monetisation potential of the content.
"We are hopeful that this trend will pick up going forward, and will result in consumers actually paying for the content they want. This will also have positive ramifications on the average revenue per user (Arpu) for the industry," said Goenka.
Taking note of factors like healthy GDP growth rate at 5.5%, declining oil prices and the recent rate cut by the Reserve Bank of India, Chandra said all these development augur well for the Indian economy and are indicative of good times ahead. "The business sentiment has been improving over the past few months. We are hopeful that this improved economic environment is going to lead to sustained growth in the coming years. Media industry would also benefit from the improvement in the economic environment. Television ad spends are likely to improve in the forthcoming quarters," he said.
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