Radio One, the joint venture between Mid-Day Multimedia and BBC Worldwide, has registered a top line growth of 8 per cent in the Q1 ended June 30, 2009, over the corresponding quarter in the last fiscal, while expenses were 2 per cent lower this Q1 even though Q1 last year had six stations operational as against seven stations contributing to costs this Q1.
The company has also shown an exponential growth in operating profit before license fee of 285 per cent from the same period last year and an EBIDTA (Earnings before Interest Depreciation Tax and Amortization) growth of 56 per cent from the same period last year.
Commenting on the Q1 results, Vineet Singh Hukmani, Managing Director, Radio One, said, “We had promised our investors that this year will be a focus on EBIDTA improvement and operational cash independence versus top line growth as being chased by the rest of the industry. This focus on EBIDTA is to create confidence in our investors on our improved operational business efficiency before Phase III investments. It is also the only yardstick to prove that each of our station heads run their stations in true business spirit and ‘spend only from what they earn.”
The radio industry has increased in ad volume in Q1 FY10 by almost 28 per cent from Q1 FY09 in the seven cities that Radio One operates. Radio One improved its volume share in Q1 this year by 43 per cent from Q1 last year and had a positive value growth of 2 per cent, when the industry fell in value by over 14 per cent in the seven cities as per the company release.
According to Singh, “The reasons for this growth in business efficiency are three-fold – hard business logic before speculative brand and marketing logic, which resulted in more focus on EBIDTA; operational cash independence versus an expensive top line chase in a market where value is falling.”
Radio One operates in seven metro markets – Mumbai, Delhi, Kolkata, Chennai, Bangalore, Pune and Ahmedabad.