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Poor performance of exhibition biz causes 67% dip in PVR’s Q2 net

MUMBAI: Gurgaon-based PVR Cinemas has posted a sharp 66.6 per cent drop in its consolidated net profit for the quarter ended 30 September 2014. This is owing to the fact that the profit from its movie exhibition business almost halved during the quarter.

The multiplex major’s consolidated net profit (after taxes, minority interest and share of associates) for the second quarter stood at Rs 9.20 crore (Rs 92 million), as against a net profit of Rs 27.55 crore (Rs 275.5 million) in the year-ago period.

PVR’s total income from operations (net) during the quarter stood at Rs 400.20 crore (Rs 4 billion), up 9.41 per cent from Rs 365.77 crore (Rs 3.66 billion) in the corresponding quarter of the previous fiscal.

However, its expenses rose 19.49 per cent to Rs 372.66 crore (Rs 3.73 billion) compared to Rs 311.88 crore (Rs 3.12 billion) in Q2FY14.

PVR incurred cost of Rs 12.68 crore (Rs 126.8 million) as movie production and distribution expenses. These expenses stood at just Rs 21 lakh (Rs 2.1 million) in the year-ago period.

The increased expenses affected its profit from operations (before other income, finance cost and exceptional items), which dropped to Rs 27.54 crore (Rs 275.4 million), compared to Rs 53.89 crore (Rs 538.9 million) a year ago.

When it comes to segment-wise performance, PVR’s revenue from its core business of movie exhibition (net of entertainment tax, sales tax and service tax) for the quarter saw a mere 7.23 per cent growth to Rs 368.18 crore (Rs 3.68 billion) from Rs 343.36 crore (Rs 3.43 billion).

As mentioned earlier, the exhibition segment profit dropped 49.94 per cent to Rs 27.14 crore (Rs 271.4 million), compared to Rs 54.22 crore (Rs 542.2 million) in the year-ago period.

The movie production and distribution segment saw revenue surging from Rs 6.12 crore (Rs 61.2 million) to Rs 18.87 crore (Rs 188.7 million). Profit from the segment stood at Rs 1.34 crore (Rs 13.4 million), compared to Rs 1 lakh (Rs 0.1 million) in the year-ago period.

The other segment, which includes bowling, gaming and restaurant services, etc., saw revenues fall marginally to Rs 18.19 crore (Rs 181.9 million) from Rs 18.72 crore (Rs 187.2 million).

The segment sustained a loss of Rs 96 lakh (Rs 9.6 million), compared to a loss of Rs 26 lakh (Rs 2.6 million) in the year-ago period.