Zee Ent shares soar 8% as Q2 net rises

The media firm reported 8.72 per cent increase in consolidated net profit at Rs 247.40 crore in Q2 FY16.

Total revenue during the quarter stood at Rs 1,384.9 crore (Rs 13.85 billion) compared to Rs 1,117.8 crore (Rs 11.18 billion) in the corresponding quarter of the previous fiscal.

Other sales and services revenue, which include syndication sales, film distribution, commission on sales, play out & transmission services, facility usage income, stood at Rs 62.5 crore, a decline of 7.4% from Rs 67.4 crore in the same quarter a year ago.

During the quarter, the pay-TV operator’s domestic subscription revenues stood at INR3,752 million while worldwide subscription revenues stood at INR1,039 million. Profit after tax (PAT) at Rs 246.3 crore was up 8.5% over the previous quarter and PAT margin stood at 17.8%.

“Subscription growth too was healthy at 12.9 per cent with domestic/international subscription revenues up 11.2 per cent/19 per cent”, Rumit Dugar and Saumya Shrivastava of Religare said.

“We remain positive on the company’s long-term outlook on the back of the improving macro environment and network market share gain”.

Global subscription income in the quarter was up 19.2 per cent to Rs 103.9 crore (Rs 1.04 billion). “Our effort is to entertain audience across the world”, said Subhash Chandra, chairman, ZEE. We have grown as a network on the back of superior programming on our new and existing products.

Employee Benefit Expense increased 17.4 per cent to Rs 126.70 crore (9.1 per cent of TR) than the Rs 107.96 crore (9.7 per cent of TR) in Q2-2015, but was 8.2 per cent lower than the Rs 138.01 crore (10.3 per cent of TR) in Q1-2016. The improvement in the overall advertisement market has further aided our strong growth. Domestic brokerage Religare said Zee Entertainment’s ad revenue growth surprised at 35 per cent year-on-year versus estimates of 25 per cent, pushing up EBITDA margins by 238 basis points quarter-on-quarter to 25.6 per cent.

“Going forward, our endeavour would be to further enhance our offerings and be ahead of the market in delivering innovative and high-quality entertainment to our viewers across consumption platforms”.

Going forward, Goenka said ZEE believes the key for monetising revenues, in both advertising and subscriptions, is “excellent content”.

The board also noted the resignation of Subodh Kumar, executive vice chairman from his executive position in the company with immediate effect.

Chandra’s eldest son Punit Goenka is heading Zee Entertainment as managing director and chief executive officer.