Zee net rises 64% on ad sales lift

Zee Entertainment Enterprises Ltd (ZEEL), the leading media and entertainment company, on Tuesday reported a 64% rise in its April-June consolidated net profit at Rs 150 crore over the same period previous fiscal.

Consolidated net sales for the first quarter grew 42.2% to Rs 677 crore, on the back of a 90.4% growth in advertising revenue at Rs377 crore, which exceeded expectations.

The scenario, the company said, clearly outlines a buoyant macro environment and a continued preference of advertisers towards television.

Subhash Chandra, chairman, ZEEL, commenting on the financial performance, said the Indian economy continues to grow at a healthy pace and the company is looking forward to robust growth in all sectors.

“The revival in advertising spends is a clear sign of buoyancy. The Indian television industry continued its march towards digitisation with a healthy addition of 2.5 million digital homes on direct-to-home (DTH) alone. Additionally, there are many homes which are turning to digital cable too. The 3G rollout would bring another opportunity to monetise our content on the mobile platform,” he said.

The consolidated operating profit (Ebitda) for the quarter stood at Rs 187 crore and the Ebitda margin expanded to 27.6%, a growth of around 300 basis points over the corresponding period last fiscal.

Punit Goenka, managing director and chief executive officer, ZEEL, said, “Despite a heavy sports calendar during the quarter on competing channels, our portfolio has done very well, both in terms of viewership ratings and revenues. While the competitive intensity remains high in the Indian television industry, we continue to make efforts towards further enhancing our market share.”

The first quarter numbers also include financial results of regional general entertainment channel business (R-GEC) acquired from Zee News Ltd.

“The R-GEC business was acquired effective from January 1, 2010, and hence, the numbers for the quarter are not comparable with those of the corresponding quarter last fiscal,” said Atul Das, president - corporate strategy, planning & business development, ZEEL. The total subscription revenue for the quarter rose 8.5% at Rs 261.4 crore. Domestic subscription revenue stood at Rs 160.4 crore, while international subscription revenue was Rs 101 crore.

Goenka said, “DTH revenues are driving our subscription growth for the last several quarters. During this quarter, we have seen some growth in domestic cable revenues too. The regional channels have also recorded strong operating results. The outlook for the year remains buoyant and we look forward to a robust growth during the year.”