TV18, Network18 turn corner with Q3 profits
Network18's net profit stood at Rs 6.8 crore while TV18 reported consolidated net profit of Rs. 21.3 crore.
New Delhi: Network18 Media and Investments reported a net profit at the consolidated level for the December quarter, led by strong performances in its broadcasting and digital businesses while TV18 Broadcast turned corner during the quarter driven by strong growth in broadcasting and distribution revenues. Network18's net profit stood at Rs 6.8 crore and operating profit at Rs 10.6 crore and TV18 reported consolidated net profit of Rs. 21.3 crore with quarterly revenues of Rs 512.4 crore, which was up 72 per cent year-on-year and a gain of 59 per cent quarter-on-quarter.
Network18's consolidated quarterly revenues surged to Rs 697.4 crore, up 52 percent year-on-year. "Our recast balance sheets helped us rationalize our interest payouts and our television and digital assets turned in strong operational performances," said Raghav Bahl, Managing Director, Network18 in a press statement.
TV18 broadcast, in which Network18 holds majority stake, had been reporting net losses at the consolidated level for five successive quarters till September 2012. "Our net distribution income (subscription revenues minus carriage fee) has finally broken into positive territory and our recast balance sheet has helped us rationalize our interest payouts," said Raghav Bahl, Managing Director, Network18 in a press statement, adding, "we are now entering an exciting phase in our journey as we strengthen our existing operations and consolidate our regional acquisition."
The company recently raised Rs 2700 crore through a rights issue to fund its acquisition of Eenadu group-promoted ETV. Network18's digital content and e-commerce divisions together logged revenues of Rs 119.6 crore, up 104 percent over last year.
"We are extremely pleased that all our broadcast and digital content operations grew their margins despite softness in the advertising environment," B Saikumar, group CEO said in the release, adding, "Our e-commerce businesses have turned in another stellar quarter doubling over the previous year."
Network18's digital content operations recorded revenues of Rs 22.4 crores, growing around 20 per cent year on year. Moneycontrol.com jumped to an unprecedented 14.9 million unique visitors in December 2012 as per Comscore World Report, the company said in the press release.
"All our content properties - moneycontrol.com, in.com, IBNLive.com and Firstpost.com continued to innovate and maintain their market leadership positions," the release said. Revenues at bookmyshow.com, in which Network18 holds minority stake, doubled year-on-year, while those at Homeshop18 grew 325 percent during the same period. Consolidated operating profit margin for the quarter was 2 percent, compared to minus 18 percent during the same quarter last year.
For TV18, advertising, the biggest contributor to broadcasting revenues, grew 10 per cent over last year to Rs 312 crore, a 27 per cent gain sequentially. Subscription revenues vaulted to Rs 29 crore from Rs 3 crore during the September quarter, and distribution revenues surged 52 per cent sequentially to Rs 144 crore.
"Our broadcast operations grew their margins despite softness in the advertising environment," said Saikumar, said. "IndiaCast has hit a positive trajectory and stays with its focus of correcting the group's distribution revenues upwards and adding more brands and partners to its stable. The News Network will further consolidate its leadership position with the addition of ETV News to the stable," he said.
IndiaCast is a 50:50 joint venture between TV18 and Viacom, managing the two companies' distribution operations. TV18's quarterly operating profit (EBITDA) was Rs 48.1 crore. Operating profit margin at 9 per cent was held in check by a 38 per cent quarter-on-quarter jump in marketing, promotional and production expenses.
The company said its general news operations broke into positive territory with 10 per cent margin. Operating profit for the business news segment trebled year-on-year with the company attributing it to a significant improvement in net distribution income. Both CNBC TV18 and CNBC Awaaz continued to be market leaders during the quarter, the company said.
TV18 has commenced the integration of ETV non-Telugu News and Entertainment operations. "We believe that the opportunity is large and will require significant re-investment into content and marketing to re-gain audience traction and establish the channels as leaders in their niche genres. This re-investment could entail risks to the ETV profitability during the re-investment phase," the release said.
Disclaimer: IBNLive.com is part of Network18 Group.