ZEEL, Network18, TV18, NDTV, TV Today ad spends estimated at Rs.500 crore in Q1

ZEEL, Network18, TV18, NDTV, TV Today ad spends estimated at Rs.500 crore in Q1

Author | Collin Furtado | Thursday, Aug 13,2015 8:35 AM

ZEEL, Network18, TV18, NDTV, TV Today ad spends estimated at Rs.500 crore in Q1

The previous quarter (Q4FY2015) was on an average a good quarter for major broadcasters with the results showing an average growth of 18% in operating revenues. Network18 saw a positive quarter as operating revenues increased by 14%. TV18 also saw its operating revenues grow by 11.7% over Q4FY2014. Sun TV Network’s total operating revenues grew by 5.4% over Q4FY2014. Raj TV Network total operating revenues increased by 28.4%. TV Today Network total operating income increase by 17.5%. NDTV Network too saw its total operating revenues increase by 33.3%. Only ZEEL’s operating profits (EBITDA) decline by 13.1% in comparison to the corresponding quarter in the previous year.

FY 2016 first quarter results of TV broadcasters saw high ad spends for many and lower operating revenues. This resulted in revenues of a certain broadcasters to fall low and in some cases a few even reported net losses.

TV18 & TV Today ad spends increase by 30-80% on rebranding of channels   

TV broadcasters such as ZEEL, TV18 and TV Today Network saw a double-digit growth in ad spends of 30-80%. While TV18 ad spends grew by 32.9% and TV Today’s ad spends grew by an enormous 83.7% as compared to the same quarter last year. 

TV18 too incurred higher double digit ad spends as a result of the expenses incurred by the rebranding of the ETV regional entertainment channels to Colors during the quarter. Marketing, distribution and promotion expenses increased significantly by 32.9% since Q1FY2015, and by 19.7% since the last quarter. The ad and marketing spends accounted to Rs.135.9 crore in Q1FY2016 from Rs.102.2 crore in Q1FY2015 and Rs.113.5 crore in Q4FY2015. The total expenses of the network were also as much as the total revenues it earned during the quarter and as a result TV18 suffered a net loss after tax amounting to Rs.10.6 crore.

TV Today Network’s advertising, distribution and sales promotion spends during the first quarter increased phenomenally this quarter by 83.7% as against the corresponding quarter last year. It also increased by 17% since the last quarter Q4FY2015. The ad and promotion spends of the channel increased to Rs.38.2 crore in Q1FY2016 from Rs.20.8 crore in Q1FY2015 and Rs.32.6 crore in Q4FY2015. The reason for this rise is the rebranding of Headlines Today channel to India Today on May 23, 2015 for which TV Today Network spend Rs.14.48 crore on the marketing. The total expenses had also seen a high increase of 23.1% since June ending quarter last year as it increased to Rs.105.28 crore in Q1FY2016 from Rs.85.51 crore in Q1FY2015. TV18 operating revenues grew by 13 per cent in comparison with Q1FY2015, however it declined by 5.5 per cent since the last quarter. In Q1FY2016 the operating revenues was Rs.596.7 crore in comparison with Rs.629.7 crore and Rs.527.7 crore.

High single-digit ad spends of 8-9% from Network18 and NDTV

While Network18’s ad and marketing spends grew by high single-digit of 9.8%, NDTV’s ad spends too saw a similar growth of 8.3% as compared to the first quarter last year.

Network18’s growth also increased by 6.1% since Q4FY2015. It increased to Rs.211.2 crore in Q1FY2016 from Rs.192.2 crore in Q1FY2015 and Rs.198.9 crore in Q4FY2015. Total expenses of Network18 grew marginally since the last quarter but grew larger in comparison with the corresponding quarter last year. While in comparison to the Q1FY2015 it grew by 10.6% as total expenses recorded was Rs.811.9 crore in Q1FY2016 from Rs.733.5 crore in Q1FY2015, during the previous quarter Q4FY2015 it was at Rs.789 crore. The network registered a net loss after tax of Rs.5.9 crore.

NDTV’s marketing, distribution and promotional expenses grew by 8.3% as against the first quarter in the previous year. It also saw a 9.4% rise in comparison with Q4FY2015. The marketing spends in Q1FY2016 stood at Rs.37.21 crore as against Rs.34.33 crore in Q1FY2015 and Rs.33.99 crore in Q4FY2015. However, the total expenses had seen a decline of 8.6% in comparison to Q1FY2015. The reason for this is product expenses had seen a major decline from Rs.27.19 crore in Q1FY2015 to Rs.14.69 crore in Q1FY2016.  NDTV saw its total income from operations decline by 30.1% as it declined to Rs.90 crore in Q1FY2016 from Rs.117.24 crore in Q1FY2015. NDTV reported a net loss of Rs 24 crore in Q1FY2016, of which Rs 11 crore pertains to the ecommerce businesses.

ZEEL’s ad spends increase by a high 20%  

ZEEL’s advertising and publicity expenses rose by a high double-digit in Q1FY2016 to 20% in comparison with Q1FY2015. Advertising and publicity expenses grew to Rs.96.6 crore in Q1FY2016 from Rs.80.3 crore in Q1 last year. However, it marginally reduced from Q4FY2015 due to adverting and publicity expenses being higher. The network’s total expenses during the quarter saw a large rise as it grew by 36.6% in comparison with Q1FY2015. Total expenses grew to Rs.1,045 crore in Q1FY2016 from Rs.765 crore in Q1FY2015.

Despite the high ad spends ZEEL’s total income from operations grew by 26.6 per cent in comparison with the corresponding quarter during the previous year. The income from operations grew in Q1FY2016 to Rs.1,339 crore from Rs.1,055 crore in Q1FY2015, in Q4FY2015 it was at Rs.1,347 crore. The profit after tax (PAT) of ZEEL for the quarter increased to Rs.242.3 crore from Rs.210 crore in Q1FY2015 and Rs.231.9 crore in Q4FY2015. This is an increase of a good 15.3% from the corresponding quarter last year and a marginal rise of 4.4% since the last quarter.

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