Network18 reports strong Q3 numbers, EBITDA jumps fivefold

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Network18 Media & Investments Monday announced its results for the quarter ending December 31, 2013.Consolidated reported operating profits or EBITDA surged fivefold to Rs. 61 crores from Rs. 10.6 crores y-o-y, driven by record profits in Television and robust growth in Digital businesses. Network18 consolidated revenues for Q3 FY14 stood at Rs. 727.6 crores, up 4 percent over prior year.Television and Motion PicturesQ3 FY13-14 Financial Highlights*Reported revenues on a consolidated basis stood at Rs. 525.5 crores for the quarter, up 3 percent over prior year. The company reported its highest ever quarterly Operating Profit (EBITDA) at Rs. 77.5 crores (up 61 percent yoy) with both the Entertainment and News businesses turning in strong quarters.*On a consolidated basis, advertising revenues grew 3 percent year on year. While the News and Infotainment advertising environment continues to be sluggish, Entertainment led by Colors and MTV delivered strong double digit advertising growth. Net Distribution Income (NDI) at Rs.43.6 crores continued its steady growth, growing 145 percent year on year.*TV18's Broadcast operations turned in a very strong quarter with an operating profit of Rs. 91.1 crores, up 110 percent on a year over year basis.Proforma Q3 FY13-14 Financial HighlightsProforma results are assuming financial consolidation of ETV News (100 percent) and ETV Entertainment (50 percent). On 22 Jan 2014, post receipt of required regulatory approvals, TV18 completed the acquisition of the ETV channels – 100 percent of ETV News, 50 percent of ETV Entertainment and 24.5 percent of ETV Telugu.*Proforma reported revenues on a consolidated basis stood at Rs. 595.9 crores for the quarter, up 5 percent over prior year. Proforma Operating Profit (EBITDA) came in at Rs. 94.5 crores (up 79 percent yoy) led by a strong performance in ETV News.*On a proforma basis, this was a landmark quarter for TV18 with Broadcast operations turning in an EBITDA of Rs. 108.1 crores. ETV Entertainment reported a sharp reduction in losses compared to the previous two quarters as programming and marketing investments made in the first half led to an upswing in ratings and revenues. Digital Content and Commerce*Digital Content and Commerce operations sustained their growth momentum delivering a 25 percent growth in revenues to Rs. 149.8 crores in the quarter. The segment also saw a sharp reduction in operating losses, which reduced by 55 percent year on year.Announcing the results, Raghav Bahl, Managing Director, Network18 said: “We are greatly enthused by the strong performance of Network18 despite the continued uncertainty in the macro-economic landscape. While environmental risks may continue in the medium term, we are confident of maintaining our growth trajectory. During the quarter, our digital operations grew substantially and broadcast operations posted healthy margins, which led to the sharp improvement in our operating profits, aided further by a healthy balance sheet. We are now in the sustained value creation phase of our journey even as we look to further strengthen our existing broadcast and digital businesses and consolidate our regional acquisition”Commenting on the results for the quarter, B. Saikumar, Group CEO, Network18 said: “Our broadcast operations grew their margins substantially in a challenging environment. Our News business realised value from operating efficiencies and Infotainment operations broke into positive territory. Our Entertainment operations led by Colors delivered a healthy performance even as Motion Pictures saw losses in this quarter. IndiaCast continued on its robust growth trajectory. We continued to grow strongly in our digital commerce business and our digital content business sustained its momentum towards profitability. We look forward to building on network synergies with our new broadcast and digital initiatives - Rishtey India, MTV Indies, CNBC Bajar, firstbiz.com and News18.com. We are confident of sustaining our strong performance in the year ahead.” Net Distribution Income

For the third quarter of FY14, Net Distribution Income stood at Rs. 43.6 crores. Effective 1st July 2012, IndiaCast is now managing TV18's and Viacom18's distribution operations. Pursuant to this development, Broadcast operations of TV18, are now reporting net revenues from distribution starting Q2 FY13. Net Distribution Income may be understood as subscription revenues earned by the company minus carriage/placement fees or any promotions/commission paid. Please note that the Net Distribution Income differs from the Subscription Revenues in our consolidated numbers because a few of our entities are still in negative territory and hence, net expenses on account of carriage form a part of the marketing and distribution expenses. Business News Operations - CNBC-TV18, CNBC Awaaz, CNBC-TV18 Prime HD*Operating profit for the current quarter stood at Rs. 33.5 crores with an operating margin of 41 percent. Operating Revenues for the current quarter stood at Rs. 80.7 crores.*CNBC-TV18 and CNBC Awaaz sustained their strong market leadership in the genre during the quarter.General News Operations - CNN-IBN, IBN7, IBN Lokmat*General News operations returned to healthy profitability in the current quarter and grew margins substantially over last year. Operating profit stood at Rs. 15 crores with an operating margin of 22 percent. Operating revenues stood at Rs.66.9 crores.*CNN-IBN and IBN7 continued their strong viewership performance reaching a combined monthly average of 27 million viewers in the quarter (Source: TAM, CS AB 15+, All India, all days, 24 hrs, 1st Oct to 28th Dec'13). The IBN Network was a leader in coverage during the state assembly elections in the quarter.Infotainment - HistoryTV18*History TV18 continued towards a profitable trajectory in the current quarter, despite softness in the advertising environment. Operating profit for the current quarter stood at Rs. 2.1 crores with revenues at Rs.7.1 crores.*HistoryTV18 sustained its impressive performance in viewership this quarter with a 22 percent market share and the highest time spent per viewer.(Source: TAM, CS AB 15+Yrs, all India, Wk 49-52'13, all days, 0600-2400 hrs, market share and average weekly time spent per viewer in mins basis sum of 30 min TVTs)Entertainment Operations – Viacom18* Q3 FY14 revenues for Viacom18 stood at Rs.557.6 crores and operating profits stood at Rs. 56 crores, an increase of 84 percent year on year.*Operating profits from our television business stood at Rs. 82.9 crores and grew by 297 percent over previous year. The growth was driven by both strong advertising and distribution revenues.*Colors emerged as a strong No. 2 in the current quarter, growing its average weekly gross viewership to 464 million. Colors was the No.1 channel during weekends with an average market share of 26 percent. It continued to lead the genre in terms of content innovation and differentiated programming. ‘24', the marquee non-fiction property made a stupendous debut during the quarter and attracted 117 million viewers across India. ‘Big Boss 7' delivered 164 million viewers and achieved the highest-ever season average in viewership. ‘Comedy Nights with Kapil' continued its run as the No.1 non-fiction show in the genre. (Source: TAM, CS4+, HSM, All Days, Q3).* MTV continued its leadership in viewership in the genre reaching 52 million viewers and further cemented its position as India's No.1 youth brand in digital engagement with over 20 million fans on Facebook and 1 million followers on Twitter. The Nick franchise and English entertainment channels - Vh1 and Comedy Central delivered strong growth in their viewership performance and consumer engagement.*Viacom18 Motion Pictures had two Hindi releases – ‘Boss' and ‘What the Fish' during the quarter in addition to ‘Bha Ji in Problem' which was a Punjabi release. ETV News & Entertainment* Q3 FY14 revenues for ETV News grew by 40 percent to Rs.36.9 crores and operating profits grew by 200 percent to Rs. 20 crores. The news channels sustained their strong viewership performance, strongly aided by the state assembly elections.* ETV Entertainment sharply reduced its losses from Rs.35 crores in Q2 FY14 to Rs 6 crores in Q3 FY14. ETV Kannada and ETV Marathi saw a sharp improvement in their viewership performance from the last two quarters.Digital Content and Commerce Network18 is one of the largest Indian digital media companies in the world in terms of unique visitors as per Comscore. Reported Revenues for Q2FY14 stood at Rs. 149.8 crores and operating losses reduced substantially y-o-y to Rs. 14.1crores. Operating losses increased q-o-q primarily on account of increased marketing spends at BookMyShow.* Our Digital Content operations recorded revenues of Rs. 24.8 crores for the quarter, while continuing their leadership in the space.* Bookmyshow.com, India's premier ticketing platform continued on its strong revenue trajectory. The average tickets sold every month grew by 53 percent to 2.9 million (Q3 average) from 1.9 million last year. HomeShop18 continued to scale across key growth parameters while improving operating efficiencies.

Disclaimer: Moneycontrol.com and CNBC-TV18 are both part of the Network18 Group.

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