Network18 Media & Investments (Network18) reported a 12 percent year-on-year rise in its consolidated operating revenue for the quarter ended September 2022 driven by its entertainment vertical.
Consolidated operating revenue for Q2FY23 was Rs 1,549 crore and that for Q2FY22 was Rs 1,387 crore, according to a statement released by the company.
The 12 percent rise in operating revenues came about despite a challenging environment. High inflation and weak consumer sentiment dampened advertisement spends on new product launches and sustenance campaigns, especially among FMCG companies. Start-up and e-commerce companies also held back advertisements as they faced a funding winter.
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Revenue growth continued to be impeded by macro factors, impacting profitability, the statement said. The network’s consolidated operating EBITDA decreased by 87 percent YoY to Rs 32 crore in Q2FY23 from Rs 253 crore in Q2FY22.
Network18 also said it was continuing to increase its investments in many businesses to grow them further. While these investments impacted profitability as costs grew faster than revenues, it has had a positive impact on operating metrics such as marketshare and viewership numbers, it added.
TV18’s two national news channels—CNN News18 and News18 India—have emerged leaders in the English and Hindi markets respectively. CNBC TV18 was already a leading player in its segment.
“The first half of the fiscal has been challenging for most sectors. However, we believe that this phase should only be a minor bump in the long runway for growth,” said Adil Zainulbhai, Chairman of Network18. “Our presence across the full spectrum of content segments and platforms places us in a unique position to leverage the combined strengths of our assets.”
TV18’s entertainment vertical, which includes Viacom18’s 38 channels, Voot and AETN18’s two infotainment channels, saw operating revenue grow 17 percent year on year. Its operating revenue for Q2FY23 was Rs 1,176 crore against Q2FY22’s Rs 1,007 crore. The growth here was primarily driven by the movie segment; advertising revenue was flat. But, adjusting for the impact of withdrawal of Colors Rishtey from DD FreeDish, ad revenue grew in high single digits on a YoY basis. This segment reported an operating EBITDA of Rs 45 crore, down 76 percent YoY.
The company said that Colors has strengthened its #2 position in the Hindi GEC segment. TV18’s entertainment network had 9.9 percent viewership share in the non-news genre during the quarter, said the statement.
TV18 news segment revenue for this quarter was down 3 percent YoY primarily because of a decrease in advertising revenue. But the scale-up of events-led monetisation partially offset the loss of display advertising.
Operating costs for the quarter went up by 20 percent, mostly because of content cost and distribution initiatives leading to an operating EBITDA loss of Rs 9 crore. However, the investments seemed to be paying off because there was a visible improvement in viewership metrics over the last two quarters. “However, because of a subdued advertising environment, increase in viewership did not translate into commensurate revenue,” said the release.
TV18’s news vertical News18 had the highest reach among news networks and it was the #2 player in terms of viewership with 11.5 percent market share in the news segment. With five of its regional news channels as leaders in their respective genres, New18 has become the dominant news brand for the Hindi-speaking audiences.
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Network18’s digital news vertical, which houses flagship brands such as Moneycontrol and News18.com, saw operating revenue grow by 5 percent YoY. Operating revenue for Q2FY23 was Rs 87 crore compared to Q2FY22’s Rs 83 crore. Here too the impact of slowdown in ad revenue was felt. The segment reported an operating EBITDA loss of Rs 6 crore for the quarter driven by an increase in operating costs. The company is chasing leadership across digital news verticals, so it expects the business to be in investment phase for the next few quarters.
Network18’s digital news portfolio reaches nearly 200 million internet users every month, making it one of top 3 digital news/information platforms by reach in the country.
Under the live and ticketing vertical, BookMyshow continued to see sharp improvement in operating and financial metrics with several big-ticket movies released this quarter, according to the release.
“Traction of Live events vertical also grew, led by music and stand-up comedy events. The Company continues to benefit from cost rationalisation carried out earlier to mitigate the impact of the pandemic and reported an improvement in its financial performance during the quarter,” it added.
(DISCLAIMER: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.)
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