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Zee Media Q3 results: Despite demonetisation, ad revenues up by 10 per cent; increase from Rs 103.46 crore to Rs 114.43 crore

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Zee Media Q3 results: Despite demonetisation, ad revenues up by 10 per cent; increase from Rs 103.46 crore to Rs 114.43 crore

The quarterly results of Zee Media Corporation Limited (ZMCL), the broadcaster of eleven news channels and publisher of DNA, recorded an overall profit (EBITDA – earnings before interest, tax, depreciation and amortisation) of Rs 6.31 crore. When compared with Q3 FY 16, the profit for the quarter ended December 31, 2016, has gone down by 70.7% as profit in the corresponding quarter last year stood at Rs 21.54 crore.

The decrease in profit has been caused both due to a decrease in revenues and increase in expenditures. While operating revenues slipped by 5.9% from Rs 144.48 crore to Rs 135.93 crore, expenditures grew at a rate of 5.4% from Rs 122.94 crore to Rs 129.62 crore.

Advertising revenues rose despite demonetisation

Despite demonetisation, ZMCL’s business managed to move its advertising revenues in the northward direction. During the three month period between October to December 2016, advertising revenues had a positive growth of over 10%. They increased from Rs 103.46 crore to Rs 114.43 crore.

The fall in total revenues can be instead attributed to a massive 61.7% dip in subscription revenues declining steeply from Rs 30.64 crore to Rs 11.74 crore. As a result, the contribution of subscription revenues to the sum total of entire revenues fell to single digit percentage points at 8.6% compared to an impressive 21.2% during Q3 FY 16.

Expenditures rose owing to the cost of goods and operations and other expenses. The former set of expenses grew by 10.8% at Rs 36.48 crore while the latter went up by 17.4% to Rs 61.66 crore. Expenses incurred on employees declined by 16.1% to Rs 31.48 crore from Rs 37.52 crore earlier.

Television operations a tad less profitable

The television business of ZMCL remained profitable at Rs 20.2 crore during FY Q3 17. It did reflect a marginal dip though from Rs 20.39 crore before. Revenues from broadcasting receded to Rs 109.96 crore but expenses were also cut short to Rs 89.76 crore. During FY Q3 16, they remained at Rs 116.45 crore and Rs 96.06 crore, respectively. 

Much like the overall consolidated results, television segment’s advertising revenues went up. It increased by more than 15% to Rs 98.25 crore. Subscription revenues decreased sharply by 66.8% from Rs 27.89 crore to Rs 9.27 crore. ZMCL’s five new channels, WION, Zee Kalinga News, Zee Madhya Pradesh Chhattisgarh, Zee Purvaiya and Zee Rajasthan News failed to fetch any subscription revenue whatsoever.

Tough times for DNA

In the month of October, DNA was repackaged and launched in the city of New Delhi. Selling at a cover price of Rs 10, the newspaper was looking towards conquering unchartered territories. But Q3 FY 17 wasn’t profitable for the print operations of ZMCL.

The segment sustained a loss of Rs 13.89 crore on the back of rising expenses and falling revenues. The end figure for expenses was Rs 39.86 crore up from Rs 26.88 crore while revenues went down to Rs 25.97 crore from Rs 28.03 crore.

Broadcasting segment had a strong showing over a period of nine moths during the current fiscal between April to December 2016. In comparison to the previous fiscal, profit is up by more than Rs 10 crore from Rs 49.5 crore to Rs 60.88 crore. In the case of print, losses have tripled for the nine-month period on a comparative basis. From April till December 2015, ZMCL incurred Rs 5.34 crore losses owing to print operations. During the ongoing fiscal, it has risen to Rs 18.85 crore for the same period.

As a result, combined profits for the three quarters of FY 17 are down by 4.8% from Rs 44.16 crore to Rs 42.03 crore.

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