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ZEEL ad revenues up 7.3%, says viewership share on rise

Co exploring growth opportunities in domestic markets, international markets and digital space

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Zee Entertainment Enterprises Ltd (ZEEL) reported advertising revenues of Rs 625.9 crore, registering a 7.3% year-on-year growth for the quarter ended September 30, 2014. At Rs 320.5 crore, consolidated operating profit (Ebitda) was up 3.2% year on year and Ebitda margin at 28.7% was marginally up as compared with the same period last fiscal.

Subscriptions revenues stood at Rs 424.5 crore, of which Rs 337.3 crore came from domestic subscription, and consolidated operating revenues were Rs 1,117.8 crore for the second quarter of fiscal 2014. The company reported a net profit of Rs 227 crore and profit margin of 20.3% for the quarter under consideration.

Subhash Chandra, chairman, ZEEL, said the overall business performance reflects the investments ZEE is making to grow its business and market share. "The viewership market share is on an uptrend, which will help 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," he said.

Calling it a mixed quarter in terms of advertising spends for the Indian television industry, Punit Goenka, managing director and chief executive officer, ZEEL, said even though the overall economic sentiment was positive during the quarter, it translated into increased advertising spends only during the fag end of the quarter.

"Our expectation is that advertising spends will continue to increase during the rest of the year and our performance in the quarter reflects the industry-wide trend. On the subscription front, the transition of distribution of channels from MediaPro to Taj Television is now complete, and we continue to grow in high single digits," said Goenka.

He said implementation of digitisation in the remaining parts of the country will push the growth momentum.

"We also have enhanced our high definition (HD) offering with the launch of '& Pictures HD'. As a result of our consistent performance, we continue to maintain healthy operating margins," he said.

On the business outlook, Goenka said, though the digitisation deadlines for Phase III an IV have been pushed back, timely implementation would greatly benefit the industry.

"The proposed move to scrap advertisement cap for free-to-air (FTA) channels would be a welcome step for the industry. Also, the rollout of BARC in the near future is expected to enhance the representativeness of the viewership data.

"Creation and acquisition of excellent quality content remains core to our business and we continue to channelise investments to strengthen this core. We also continue to explore growth opportunities in domestic markets, international markets and digital space," said Goenka.

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