Q4 print advertising fully recovered to 2019 levels: Girish Agarwal
At the Q4 FY22 earnings conference call, Agarwal, Non-Executive Director, DB Corp, shared that a recent hike in advertising rates, effective this April, will further help them ramp up the revenue
On the advertising front, the year and the quarter had been very decent for us, shares Girish Agarwal, Non-Executive Director, DB Corp Ltd., while speaking at the Q4 FY22 earnings conference call. “We are happy to share that in Q4, print advertising had fully recovered to 2019 levels excluding the shortfall in government revenue and the election billing in 2019-2020,” he added.
According to Agarwal, in the month of April this year, print advertising has registered a decent growth, as compared to the same month in 2019. “The reason why I am comparing this year's results with 2019's is because the past two years had been badly impacted by Covid. We have also increased our advertising rates effective this April which, I am sure, will further help us to ramp up the revenue.”
He also mentioned that the newer sectors are looking for geo-controlled ad campaigns and new-age players looking to tap the non-metro market. He noted, “There is a paradigm shift in the way advertisers are looking at Indian language newspapers in Tier-2 and Tier-3 cities, which is certainly benefiting us.”
As per a recently published article by Harvard Business Review, the advertisers prefer traditional advertising mediums to capitalize on consumers' trust. According to Agarwal, it's heartening to know that majority of advertising categories are again looking at traditional advertising as the premium medium for advertising. However, the study further mentioned that traditional advertising is grabbing maximum eyeballs, but it is headed towards growth as advertisers also prefer tangible ads that are more effective and impactful.
On the company's financial performance and cost optimization, Agarwal commented that they continue to focus on sustainable cost optimization and therefore they will see resultant improvement in their margins going forward.
During the last financial year, they have saved around Rs.185 crores in print business' operating costs and had indicated to analysts that almost 50% of these savings were sustainable. He said, “In FY2022, we were able to take this savings to almost 80% of the savings in FY2021. As a result, the EBITDA for print business for FY2022 stood strong at 26% with around 100 basis points growth over last year. High newsprint prices were an overall dampener in the bottom line performance. We are pleased to inform you all that the domestic newsprint prices are softening and we are hopeful that this price hike era should be over now and we should get some relief from the Q2 of FY2023.”
While speaking to analysts about circulation and loss of copies, Agarwal said that in Q4 FY2021, the number of copies sold was 45 lakhs, and in Q4 FY2022, the copies sold were around 42.76 lakhs, hence it clearly shows the number declined by 5% to 6% over the Q4FY2021.
“If I talk about the pre-Covid number also, there was 10 - 12% loss in the circulation of copies. The reasons were most of the households stopped newspapers subscription, and the copies at offices, railway stations, bus stands, and hotels had also been discontinued to a large extent. We are putting all our efforts to see how we can get those numbers back, but frankly speaking, the copies have not been able to start again at most of the offices and this looks like a permanent loss.”
Talking about the digital business, Pawan Agarwal, Deputy Managing Director, DB Corp said that they are scaling up digital business by implementing a focused strategy of investment which continues to show strong growth on a sustainable basis.
He said, “We have followed the approach of being a multimodal leader in the delivery of high-quality content and best news products for the Indian market, both from the content as well as technology perspective.”
As per the latest Comscore results, the number of Dainik Bhaskar Group app's monthly active users had increased to more than 17 million in March 2022, versus just 2 million in January 2020. He said, “We have been consistently demonstrating remarkable growth in our active user base. We have also crossed the important milestone of achieving more than a million mark in daily average e-newspaper downloads. We also did a soft launch of a brand campaign with a tagline “Such kareeb se dikhta hai”, which highlights the values and core offerings of Dainik Bhaskar, high-quality trusted journalism with a large focus on local and in-depth news. The brand ambassador of the campaign was Pankaj Tripathi, who has a very strong connection in our core market and with our brand values - local and trust.”
Speaking about the radio business, he said, in the full year of FY2022 the revenues grew by 35% y-o-y to Rs.1,122 million. Volume growth gained momentum across sectors such as real state, FMCG, banking, state government, and lifestyle for the year. For the Q4 FY2022, the revenue from the radio division came in at Rs.303 million, higher by 9.2% on Y-o-Y basis.
“With the recent hike in the rates, we expect radio to perform well.”
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