HT Media back in black in Q3 due to festive season, cost cutting
The company has posted a consolidated net profit of Rs 9 crore
HT Media, the publisher of Hindustan Times, Mint and Hindustan, has returned to profitability in Q3 FY21 with a consolidated net profit of Rs 9 crore, thanks to the improvement in ad revenue on a quarter-on-quarter (QoQ) basis due to festive season and aggressive cost-cutting measures.
While the net profit declined 65% from Rs 27 crore in the corresponding quarter of the previous fiscal, it is an improvement over the Rs 41 crore net loss that it had reported in Q2 FY21 due to the impact of Covid-19 pandemic.
EBITDA stood at Rs 59 crore compared to an EBITDA loss of Rs 16 crore in the trailing quarter. On a YoY basis, the EBITDA has declined by 47% from Rs 110 crore in Q3 FY20. EBITDA margin stood at 15% in Q3 FY21 vs 18% in Q3 FY20.
The company noted that there has been a positive shift of Rs 74 crore in EBITDA and Rs 50 crore in PAT over Q2 FY21.
The revenue grew 30% sequentially to Rs 392 crore from Rs 302 crore in Q2 FY21 due to revival in ad spends across categories. On a YoY basis, the total revenue fell 38% from Rs 628 crore in Q3 FY20. The company said that the efforts on cost front led to savings of Rs 185 crore over last year.
In the print segment, the company returned to operating profits on a QoQ basis on account of growth in revenue supplemented by continuous cost initiatives. The company posted operating profit of Rs 18 crore during the quarter under review. In Q2 FY21, the company had reported an operating loss of Rs 4 crore. On a YoY basis, operating EBITDA nosedived by 78% from Rs 82 crore in Q3 FY20.
Operating revenue jumped 28% to Rs 289 crore over Q2 FY21 when the company had reported revenue of Rs 225 crore. However, the operating revenue declined by 42% on a YoY basis as both ad and circulation revenue de-grew.
The print ad and subscription grew by 46% and 5% to Rs 236 crore and Rs 47 crore respectively on a sequential basis. However, the ad and subscription revenue dropped by 38% and 34% respectively on a YoY basis.
On a QoQ basis, the company said that there has been a sharp increase in ad volumes driven by festive season. It added that there has been a strong recovery in circulation copies across publications on a sequential basis.
“The third quarter saw continued recovery in economic activity, with demand moving up from the lows seen during the lockdown. As a result of this and the festive season, ad spends saw some uptick during the quarter. We have witnessed sequential improvement in ad revenues across our print and radio platforms. The circulation of both our Hindi and English publications have also seen sequential growth," said HT Media & Hindustan Media Ventures Chairperson and Editorial Director Shobhana Bhartia.
"Our cost saving initiatives and a stable commodity price environment enabled us to return to operational profitability. We expect further improvement in our businesses, as more activities resume and the economy returns to normalcy. As always, our continued focus is on staying relevant for both readers and advertisers alike."
The print ad revenue from the English newspaper business came in at Rs 119 crore, which is a 47% decline on YoY basis and a 56% growth on QoQ basis. The circulation revenue stood at Rs 4 crore, which is a 76% decline on YoY basis and a 17% increase on QoQ basis.
The company noted that there was improvement in ad volumes across national and local advertisers on a sequential basis, however, there has been softness in ad yields. Further, the company said that it gained market share despite a challenging environment, and seen growth in almost all categories over the previous quarter due to festive spends, led by Retail, FMCG, Real Estate, Luxury, and E-Commerce.
The company's Hindi print business posted ad revenue of Rs 117 crore, a 23% YoY decline and 36% QoQ increase. During the quarter under review, the circulation revenue stood at Rs 42 crore, which is a 20% decline on yearly basis and a 3% growth on a sequential basis.
HT Media said that the ad volume growth for its Hindi daily Hindustan was led by festive spends along with election advertising. It also had a higher volume share vs last year. Further, categories such as Automobile, FMCG, Retail and Health & Fitness showed good traction. The Hindi print business also witnessed a softness in ad revenue on YoY basis.
The company's radio business continues to bleed as it posted an operating loss of Rs 16 crore vs a profit of Rs 6 crore in Q3 FY20 and a loss of Rs 17 crore in Q2 FY21. Revenue declined 45% YoY to Rs 27 crore. On a QoQ basis, it was up 78% from Rs 15 crore in Q2 FY21.
HT Media pointed out that the revenue and EBITDA declined as the radio industry is struggling post-Covid due to continued pressure on ad yields. Further, ad volumes were better across stations in Q3. It also witnessed sequential improvement in inventory utilisation.
The company's net cash balance grew by Rs 44 crore in Q3 to Rs 1043 crore.
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