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Balaji Telefilms’ consolidated Q1 net up 192%; film/TV biz drives growth

MUMBAI: Production major Balaji Telefilms has posted a whopping 192 per cent jump in its net profit for the quarter ended 30 June 2014. An increase in the number of commissioned programmes amid improved per-hour realisation and higher box-office collections have collectively done the trick for the company.

Balaji Telefilms’ consolidated net profit spurted to Rs 10.56 crore (Rs 105.6 million) during the quarter, up from Rs 3.62 crore (Rs 26.16 million) in the year-ago period. One-time receipt of maturity payment of a keyman insurance policy amounting to Rs 6.73 crore (Rs 67.3 million) had helped stay net positive then.

In spite of higher depreciation provisioning as required under the new Companies Act, 2013 and a sharp increase in content development costs, the TV business net swelled due to better per-hour realisation.

At the operational front, Balaji Telefilms witnessed a massive growth in operating profit (EBITDA), largely helped by the commissioning of television programmes. Lower marketing and distribution expenses as well as employee cost rationalisation lent a big support.

The company posted an operating profit (EBITDA) of Rs 14.71 crore (Rs 147.15 million) for the quarter under review, as against an operating loss of Rs 5.02 crore (Rs 50.19 million) in the corresponding quarter of the previous fiscal.

Consolidated revenue registered a 61 per cent jump to Rs 136.03 crore (Rs 1.36 billion), up from Rs 84.45 crore (Rs 844.53 million) in the year-ago period.

Television content business improves

Launch of two new shows—‘Kumkum Bhagya’ on Zee TV and ‘Meri Aashiqui Tumse Hi’ on Colors—provided a much-needed thrust to television business performance during the quarter. Benefits of these launches will be reaped in the next quarter as they mature and achieve stability with a time lag, the company said.

During the quarter under review, the company’s television content business generated revenues of Rs 43.50 crore (Rs 435 million), up 98 per cent, compared to Rs 21.95 crore (Rs 219.5 million) recorded in the year-ago period.

Balaji Telefilms’ television segment commissioned 208 hours of Hindi programming, which translates into per-hour realisation of Rs 20.42 lakh (Rs 2.04 million), better than the corresponding quarter’s realisation of Rs 17.61 lakh (Rs 1.76 million) last year.

The segment demonstrated an improved performance by posting an operating profit of Rs 3.80 crore (Rs 37.99 million), as against an operating loss of Rs 1.27 crore (Rs 12.68 million) recorded in the corresponding quarter of the previous fiscal.

‘Jodha Akbar’, the epic on Moghul Empire Akbar, produced by Balaji Telefilms, continues to be the number one show on Zee TV and is one of the top-three shows across Hindi GECs.

‘EK Villian’ boosts motion pictures biz

During the quarter under consideration, Balaji Telefilms generated Rs 89.39 crore (Rs 893.9 million) from film business, as against Rs 61.66 crore (Rs 616.6 million) collected in the corresponding quarter of the previous year.

Strong performance of ‘Ek Villain’ not only led to strong revenue generation, but also ensured the segment’s return to positive on both operating and net levels.

The film grossed Rs 100 crore (Rs 1 billion) at the box office. Other two film releases also did fairly well. ‘Main Tera Hero’ also recorded significant box-office collection, the company said.

Consequently, film business returned to EBITDA positive of Rs 11.15 crore (Rs 111.5 million) vis-à-vis operating loss of Rs 2.15 crore (Rs 21.5 million) in the year-ago period.

Meanwhile, Balaji Telefilms’ subsidiary BOLT has commissioned two serials ‘Dharma Kshetra’(26 episodes) and ‘Rakht’ (10 episodes) for EPIC Television Networks Pvt Ltd. The network is expected to go on air by Q2FY15.

BOLT has also commissioned ‘Yeh Jawani Ta Ra Ri’ (78 Episodes) for Channel [V] and ‘Love by Chance’ (26 episodes) for Bindaas.

The segment’s revenue zoomed to Rs 2.50 crore (Rs 25 million) in Q1FY15 as against Rs 83 lakh (Rs 8.3 million) registered in the corresponding quarter of the previous fiscal. EBITDA loss came in at Rs 24 lakh (Rs 2.4 million), up 9 per cent, while net loss widened 13.6 per cent to Rs 25 lakh (Rs 2.5 million), during the June quarter.

Balaji Telefilms hopes to gain from new television channel launches. The company claimed that the entry of newer broadcasters and digital media will lead to more demand for variety and content.

The company’s consolidated financial result is inclusive of the financial results of its subsidiaries, viz. Balaji Motion Pictures, BOLT Media and an associate entity IPB Capital Advisors LLP.

Following the announcement of results, the Balaji Telefilms counter witnessed a volatile session on the BSE. After moving between Rs 68.50 and Rs 78.25, the counter closed the session marginally lower at Rs 71.15 per share.