Focus is on entertainment, to add 69 screens this yr: PVR

Multiplex chain PVR posted a consolidated net profit of Rs 7.6 crore in the April-June quarter of 2012 against a loss of Rs 13.2 crore in the previous quarter. In an exclusive interview to CNBC-TV18, Ajay Bijli, CMD of PVR said the company is not too dependent on movies; instead the focus is on location building and technology. PVR has plans to launch 69 screens this year. Below is the edited text of the interview. Also see the accompanying video

Q: What went right with the company? It is a very good revenue growth?
A: We have opened a few more projects this quarter. Our focus has always been getting the right locations and then focusing on designs, the entertainment quotient and then getting our pricing & our programming right. So all that has paid off. We also had a good line-up of films, but I think (we benefitted) by focussing more on right location and exhibition business without getting distracted by marketing. So that’s why we have seen this growth of about 50% on our topline. Q: What is wrong with the bottomline in that case, of course you didn’t have exceptional items which put you at a loss in the previous quarter? Your prorata last year was in double digits,even Rs 20 crore in some quarters?
A: Last year - only the first quarter had exceptional item where we had sold one property and leased it back. That in fact resulted in Rs 17 crore profit. So if you compare apple to apple, we did a profit of Rs 5 crore last year. That has gone up to Rs 8 crore. So we have improved by Rs 3 crore and even our EBITDA margin has improved. Our Phoenix property in Lower Parel was booked in Q1. Service taxes, which is a new thing, also happened in this quarter. So we are happy with the set of numbers. Q: How is business looking in the current quarter and the next? How are things lined up or would it much depend on the way the films do?
A: We are not dependent on movies too much because  (we focus on) the location what we build and customer services and comfort that we give. Technology is what we bank upon and movie pipeline is always good. This year it’s exceptional because we have a lot of big blockbusters from Hollywood as well and at the same time, all the big stars have their movies coming in. So it is looking quite good. We are opening about 69 screens this year.
This quarter itself we will be having 30 more screens in Pune, Nagpur, and Mumbai. Second one in Bangalore. Then we have another one in Mysore. So we are happy with the kind of projects that we are opening up and consumers are still going out and watching movies, they are going to the malls. Our price points are still not so high. Our bowling centers are opening. We are opening about 80 lanes this year. So the whole focus of the company has gone into retail entertainment, which is exhibition business, cinema business and bowling business. And in these times people do want to go and entertain themselves. So I am happy with the way things are looking. Q: People want to entertain themselves in these times; a lot of companies are singing the tune of consumer down trading
A: A lot of people in Mumbai look at one-two properties and think that’s their average ticket price. But we have cinemas in smaller cities. So our average ticket price is Rs 160. Thus, an outing for two-three people still comes at Rs 400-500 which is quite affordable. Obviously you eliminate lots of other things from your spending patterns, but movie is still a pretty staple form of entertainment for most Indians.