BCCL reports consolidated net loss of Rs 451.63 crore in FY20
The company’s advertisement revenue has dipped to Rs 5,367.88 crore from Rs 6,155.32 crore
Media conglomerate Bennett Coleman and Company Ltd (BCCL) has posted a consolidated net loss of Rs 451.63 crore for the fiscal ended March 31, 2020, compared to a net profit of Rs 484.27 crore of the previous fiscal. This is as per data sourced from business intelligence platform Tofler.
Revenue from operations has dropped to Rs 9,254.53 crore compared to Rs 9,611.42 crore posted a year ago. Total income fell to Rs 9,733.45 crore from Rs 10,467.53 crore.
The company’s advertisement revenue has shrunk to Rs 5,367.88 crore from Rs 6,155.32 crore. Revenue from the sale of publications declined to Rs 629.96 crore from Rs 656.09 crore. Television distribution revenue marginally increased to Rs 40.17 crore from Rs 36.29 crore. Revenue from web portal and support services stands at Rs 284.95 crore as against Rs 226.42 crore.
Meanwhile, the sale of traded products has jumped to Rs 1,787.10 crore from Rs 1,379.94 crore. Other operating revenues came in at Rs 1,144.47 crore compared to Rs 1,157.36 crore.
The total expenses have jumped to Rs 9,911.05 crore from Rs 9,552.13 crore. Employee benefits expense stood at Rs 2,767.55 crore compared to Rs 2,562.93 crore. While the cost of materials consumed dipped to Rs 1,277.02 crore from Rs 1,694.66 crore, other expenses climbed to Rs 4,493.91 crore from Rs 4,053.59 crore.
Queries sent to BCCL Chairman, Executive Committee, Sivakumar Sundaram remained unanswered till the time of filing this report.
Incorporated in 1913, BCCL has a presence across print, television, radio, music, Out Of Home advertising, and the internet. Newspaper publishing is its largest business segment.
The company's print business comprises of Times of India and Economic Times in English, Navbharat Times in Hindi, Maharashtra Times in Marathi, Vijay Karnataka in Kannada, and Ei Samay in Bengali. The group also publishes magazines like Filmfare and Femina.
It has a presence in radio broadcasting under the Radio Mirchi brand through its subsidiary, Entertainment Network India Ltd (ENIL), in which the promoter group holds a 71.15% equity stake. The internet properties of the group are operated through a wholly-owned subsidiary, Times Internet Ltd (TIL).
Furthermore, it has a presence in television through Zoom TV (general entertainment channel), Times Now, Mirror Now (English news channel), ET Now (business news channel), Romedy Now, Movies Now, and MN+ (movie channels).
In terms of segments, the company's revenue from the print segment plunged to Rs 5,627.12 crore from Rs 6,259.89 crore. Revenue from the television segment jumped to Rs 826.32 crore from Rs 711.90. Internet segment reported revenue of Rs 1,200.34 crore compared to Rs 1,180.41 crore. Revenue from 'others' segment increased to Rs 1,600.75 crore from Rs 1,459.22 crore.
The company's profit before tax from the print business fell to Rs 1,005 crore from Rs 1,136.34 crore. The television business posted a profit before tax of Rs 16.41 crore against a loss before tax of Rs 33.63 crore.
The loss before tax from the internet business swelled to Rs 837.72 crore from Rs 550.66 crore. The 'others' segment reported loss before tax of Rs 344.60 crore as against a profit before tax of Rs 214.28 crore.
In April 2020, CRISIL had reaffirmed its 'CRISIL AAA/Stable' rating on the long-term bank facilities and non-convertible debenture programme of BCCL. CRISIL had noted that the rating continues to reflect BCCL's strong market position as India's largest print media group and a robust financial risk profile.
These strengths have been partially offset by susceptibility to volatile global newsprint prices and economic cycles, sizeable exposure to subsidiaries and group companies in the gestation phase, and large investment in the brand capital business (BCB).
The CRISIL report had noted that the print media industry's revenue is expected to decline by 20-25% in fiscal 2021 due to the impact of the Covid-19 pandemic.
Advertisement revenue has a high correlation with economic growth. Advertisement contributes 70-90% to the total revenue of print media companies, including BCCL.
The lockdown situation and expected weak economic activity have led to a significant drop in advertising revenue. Besides, the circulation of newspapers has been impacted in a few regions. However, in the past, advertisement revenue has rebounded sharply on the recovery of economic growth.
Revenue is expected to gradually recover from the second quarter of fiscal 2021 onwards, with a full recovery in fiscal 2022, CRISIL had stated.
"Our base case assumes BCCL's revenue to decline by 20-25% in fiscal 2021, in line with the industry. BCCL has already taken up measures to reduce costs; this should partially mitigate the drop in operating profit. A sustained slowdown may have a sharper impact on BCCL's operating performance. Alternatively, a faster reversal to normalcy may contain the extent of deterioration," CRISIL report had said.
According to CRISIL, BCCL's credit risk profile is resilient due to its market leadership, superior liquidity of over Rs 2,000 crore as of March 31, 2020, prudent capital structure, and high financial flexibility despite an expected decline in revenue in fiscal 2021.
CRISIL had also said that it will continue to monitor the pace of revival of revenue from advertisement and circulation and the impact of cost reduction initiatives on overall operating performance. Significant and sustained deviations from the base case may adversely impact BCCL's credit risk profile over the medium term and, thus, will remain a key monitorable.
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