TV18 Broadcast, the operator of the broadest network of channels, reported a solid 39.5 percent year-on-year growth in the third quarter (October-December) consolidated profit on the back of strong operating income.
Profit after tax during the quarter increased to Rs 205 crore, from Rs 147 crore in the same period last year, the company said in its BSE filing. The sequential rise in profit was nearly 3.5 times, from Rs 46 crore reported in the September quarter.
"Monetisation of content through partnerships and continued subscription revenue growth coupled with cost optimisations across verticals boosted profitability," the company said.
"In line with the strategy of being platform agnostic, the group stitched multiple partnerships with notable digital platforms for serving their users a discerning selection of our content," it added.
Other income during the quarter increased to Rs 21 crore from Rs 10 crore YoY.
The stock jumped 19 percent intraday. It was quoting at Rs 28.40, up Rs 3.55, or 14.29 percent on the BSE at the time of publishing this copy.
However, consolidated revenue from operations declined 3 percent year-on-year to Rs 1,425 crore in the quarter ended December 2019, but the same increased 26.44 percent QoQ.
Operating earnings before interest, tax, depreciation and amortisation (EBITDA) shot up 145 percent year-on-year to Rs 281 crore during the October-December period.
The company reduced its total expenses sharply to Rs 1,220 crore for the quarter, against Rs 1,423 crore in the corresponding quarter of last fiscal due to lower operating cost, employee expenses, other and MDP expenses.
"TV18 delivered a strong performance as viewership share grew and business mix pivoted towards subscription and syndication, even amidst advertising weakness," company said.
Subscription revenue during the quarter increased 40 percent to Rs 458 crore YoY after implementation of the NTO (new tariff order) which has created a transparent and non-discriminatory B2C regime.
"Improved distribution tie-ups across cable and telcos have brought the consumer closer to our class-leading content bouquet at an affordable optimum price," TV18 said.
Advertising recovered around the festive season but continued to remain under pressure for the quarter.
"The prevalent weakness in macro-environment and sluggish spending appetite by advertisers continued to drag ad-revenue down YoY for both News and Entertainment. Shift of channels from DD Freedish to Pay ecosystem continues to impact Hindi GEC ad-revenues for all the top broadcasters," company said.
Government's initiatives to boost growth and a natural refresh-and-recalibration of ad-budgets should revive ad-growth as we head towards the new fiscal, it added.Disclaimer: Reliance Industries owns TV18 Broadcast and Network 18 which publishes Moneycontrol.com.