Balaji Q3 rev up 35% QoQ due to ALTBalaji subs addition, 'Pagglait' sale to Netflix
The revenue stood at Rs 78.3 crore in the trailing quarter ended 30th September 2020
Content production company Balaji Telefilms' consolidated revenue grew 35% QoQ to Rs 105.5 crore for the quarter ended 31st December 2020 on account of strong direct subscription sales in ALTBalaji and sale of movie 'Pagglait' to Netflix. The revenue stood at Rs 78.3 crore in the trailing quarter ended 30th September 2020.
Cost of production after elimination jumped to Rs 86.3 crore compared to Rs 60.5 crore in Q2 FY21. The cost of production stood at Rs 91.3 crore for TV and films and Rs 22.5 crore for ALTBalaji. The company's net loss widened to Rs 31.6 crore during the quarter under review from Rs 19.5 crore in Q2 FY21. EBITDA loss widened 93% to Rs 24 crore from Rs 12.4 crore.
During the quarter, ALTBalaji added the highest ever subscribers with 1.6 million subscriptions sold on the back of a strong content line-up and a strategic increase in marketing spend on the back of new show releases.
The monthly direct billing run rate at the end of Q3 FY21 was Rs 10 crore and growing strongly vs billing at the end of Q2 FY21 at Rs 3.5 crore a month. ALTBalaji recognised revenue of Rs 20.1 crore including Rs 5.4 crore from ZEE5 content sharing. The platform will book Rs 11.8 crore of additional revenue to be accounted for in subsequent quarters.
Balaji's SVOD service ALTBalaji crossed 2.1 million active subscribers compared to 1.2 million at the start of the quarter. The company has been aggressively driving deeper audience engagement to reduce subscriber churn and is adding over 20,000-22,000 subscribers a day. The platform added nine shows during the quarter and has 74 shows in its library.
Balaji's TV business returned to normal production with 184.5 hours of content produced in the quarter. The average realisation was down to Rs 0.31 crore per hour in 9M FY21 from Rs 0.36 crore in 9M FY20. The company stated that gross margins in the quarter, which got impacted due to new show launches, are expected to stabilise in the current quarter as per normal operations.
The TV business had three new show launches (Prem Bandhan on Dangal, Molkki on Colors, and Brahmarakshas 2 on Zee TV) which impacted the margins for initial episodes. In total, Balaji had seven shows on air during the quarter including the new show launches. The four shows running through the quarter were Kumkum Bhagya, Kundali Bhagya on Zee, Yeh Hai Chhatein on Star, and Naagin 5 on Colors while two shows - Kasautii Zindagii Kay and Pavitra Bhagya - came to an end.
The company said that the TV business is now operating at more normal levels as daily show production hours pick up. Average rates remain firm after the initial impact of COVID-19, it added.
Balaji said that its movie business continues to wait for the availability of theatrical launch windows. Currently, the company is working on five projects with three movies expected to commence shooting in March/April 2021 while the remaining two projects are expected to commence shooting in coming quarters. Overall, the company remains conservative with investments in movies and continues to pursue pre-sales and co-production.
'Villain 2' (directed by Mohit Suri and starring John Abraham) and 'Goodbye' (directed by Vikas Behl and starring Amitabh Bachchan) will commence shooting in March 2021. Shooting for 'Rewind' directed by Anurag Kashyap and starring Taapsee Pannu commenced in February 2021. Two other projects are official adaptations and remakes.
Balaji Telefilms Managing Director Shobha Kapoor said, "ALTBalaji has added highest ever 1.6 million subscribers this quarter which shows the strong demand for the mass content that we create for Indian audiences. I believe we will continue to see strong subscriber additions in the coming quarters as we continue to develop the right and relevant content for our audience and have a very strong content lineup under production. Our TV business has seen a good recovery in terms of production hours and we hope to maintain this momentum through the new year. In the movie business, production for some of the exciting projects will start soon and we are closely monitoring the availability for theatrical releases. Overall, I am confident of the coming quarters and working on a lot of exciting content."
The company has maintained a strong balance sheet and liquidity. It has bank FD and MF of Rs 148 crore and short-term receivables in movies of Rs 10 crore. The total balance stood at Rs 158 crore.
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