Circulation growth strong, see no more cover price hike: DB Corp

Media firm DB Corp announced its Q3 results Friday, reporting a 6.6 percent year-on-year (YoY) rise in consolidated net profit at Rs 118.10 crore. Earnings before interest, taxes, depreciation and amortisation (EBITDA) which was around Rs 200 crore, was the highest ever reported by the company.Speaking to CNBC-TV18, its Director Girish Agarwaal, said 9MFY17 consolidated advertising revenue grew 9 percent YoY.Subscriptions grew 60 percent on increase in cover price, but the company is not looking to increase cover prices any further, he said.The company aims to have 30 Radio stations by end of this quarter, he said. During 9MFY17 this business posted 21 percent topline growth. Below is the verbatim transcript of Girish Agarwaal’s interview to Reema Tendulkar & Nigel D'Souza on CNBC-TV18.Reema: The concern actually is on the print advertising revenue growth. Just a growth of 2.4 percent in quarter three FY17. The impact of demonetisation appears to be there but post that now as things stand has normalcy returned back to the business?A: Frankly speaking in the month of October we had a very strong double digit growth, but after demonetisation in November and December there was a problem. If you look at a brighter side in this quarter, we on our EBITDA for around Rs 200 crore which is the highest ever EBITDA done by us in any quarters since the time we got listed. It will be more prudent to now look at a nine months number because as you all know there has been a problem in last two months and so we look at the nine months number we are at around 11 percent advertising growth on the consolidated basis.Also important to note that an in spite of revenue going down like as you said 2.5 percent in print and 4 percent overall we have still maintained an EBITDA margin of around 32 percent in this quarter also.Nigel: How are news print prices moving then?A: News print prices we have seen an increase of around 4 percent in terms of news print rate last year - 9 months.Reema: Your circulation revenue growth was quite strong at 8.9 percent could you give us the breakup in terms of pricing as well as volumes?A: Almost 60 percent is because of the increase in the cover price; around 40 percent I would say is from the circulation increase.Nigel: Give us an outlook then on the advertising revenues due to the UP election? Remember the government will revise its rates in the quarter four. What kind of benefit do you expect from this?A: Government advertising and the election rates or the volume doesn’t really make much of difference, maybe a couple of percentages. I think the most important for all of us to see how the economy is getting revived because the impact of demonetisation we feel that it is now getting subsided, things are coming back to normal.Important is to see how fast it will come back to normal and the growth because right now last two months have been negative, so from negative when you say come back to normal means you come to zero growth and from zero you want to grow, so that we need to see how far that is done.