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Lack of big film releases hurts PVR’s Q1 EBITDA

MUMBAI: Multiplex chain operator PVR Ltd’s consolidated net profit for the fiscal first quarter nearly halved even though its total income operations witnessed a steady growth.

PVR’s consolidated net profit stood at Rs 7.46 crore (Rs 74.6 million) while operating income edged up to Rs 362.26 crore (Rs 3.62 billion), showing an increase of 8 per cent over the year-ago period.

Lack of big-budget film releases in the quarter largely impacted PVR’s operating profit (EBITDA). Consolidated EBITDA stood at Rs 55.90 crore (Rs 559 million) in the June quarter compared to Rs 61.43 crore (Rs 614.3 million) a year ago, marking a 9 per cent decrease.

Movie exhibition business, which continues to be the major bread-earner for the company, contributed 93 per cent to its top line.

The movie exhibition segment witnessed 15.2 million footfalls in PVR cinemas during the period under review. However, this was marginally up, just 0.4 per cent, compared to the numbers recorded in the corresponding quarter of the previous year.

Besides, movie exhibition costs grew substantially to Rs 89.14 crore (Rs 891.4 million), up 57 per cent over the year-ago level. High rent also impacted its operations. Rent payment during the quarter almost doubled to Rs 63.9 crore (Rs 639 million) compared to Rs 32.6 crore (Rs 326 million) spent in the corresponding quarter of the previous fiscal.

In spite of a slow box office, revenues from the food and beverage segment showed a strong growth of 20 per cent over the corresponding quarter of the preceding year. This was largely due to the success of various strategic initiatives taken by the company. Sponsorship revenues also witnessed a growth of 15 per cent over the corresponding quarter of the previous year.

Commenting on the results and performance, PVR chairman and MD Ajay Bijli said, “Early Q2 industry box-office results have been very strong with movies like ‘Ek Villain’ and ‘Kick’. We are optimistic regarding the box-office prospects for the remaining part of the year, which underpins our confidence that we are on track with our plans for the full year. Our differentiated strategy, heightened brand awareness and guest engagement tactics will further enhance customer experience in 2014 and beyond.”

Meanwhile, the company’s board of directors, at its meeting held on Thursday, decided to raise Rs 500 crore (Rs 5 billion) through qualified institutional placement (QIP), subject to approval of the shareholders in the forthcoming annual general meeting.

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PVR eyes acquisitions, gets board nod to raise Rs 5 bn via QIP