ABP Group’s broadcast biz drives FY18 profit growth

MUMBAI: Media conglomerate ABP Group’s broadcast business under ABP News Network (ANN) has fired its FY18 net profit growth. The company’s net profit has jumped to Rs 99.87 crore for the fiscal ended 31 March 2018 compared to Rs 53.83 crore in the previous fiscal.

The company’s profit before interest lease depreciation and tax (PBILDT) jumped to Rs 238.72 crore compared to Rs 186.31 crore in the prior fiscal. Even as the profitability improved, the company’s operating revenue dropped marginally to Rs 1316.4 crore compared to Rs 1319.5 crore.

Recently, rating agency Care had reaffirmed the long-term and short-term bank facilities of the company worth Rs 364.75 crore. The agency had taken a consolidated view of ABP and its wholly owned subsidiaries ANN Swarnakshar Prakasani and ABP Digital as it operates in the similar industry and has financial linkages.

The rating agency had noted that the ratings assigned to the bank facilities/instruments of ABP continue to derive strength from the experienced promoters of ABP with an established track record, diversified portfolio of newspapers, magazines & news channels, strong position in the print and electronic media segment.

In H1FY18, ANN had earned a net profit of Rs.22.76 crore compared to Rs 19.48 crore in H1 FY17 on a total operating income of Rs. 219.6 crore

It further noted that though the company’s print media is concentrated in Eastern India, its satisfactory financial performance of the group in FY18 & Q1FY19, satisfactory liquidity and significant debt prepayment has resulted in improved capital structure and debt protection metrics.

Care also said that the ratings are constrained by increasing trend of newsprint price & declining advertising revenue in the print media, thereby, putting pressure on the future profitability, as reflected in Q1FY19 performance, which has however been partly offset by improving the performance of news channels in the subsidiary company.

In Q1FY19, the group reported combined PBILDT of Rs.48.2 crore on a total operating income of Rs. 343.6 crore. The operating margin of the company declined in Q1FY19 vis-à-vis FY18 on account of increase in the landed cost of newsprint.

The ratings continue to be constrained by forex fluctuation risk and significant dependence on advertisement revenue.

The ability of the group to achieve growth in its advertising revenue, pass on the increasing newsprint price and stabilisation of Gujarati news channel ABP Asmita channel are the key rating sensitivities, Care said.

The newspapers and news channels enjoy a strong position in their respective genres. Bengali daily Anandabazar Patrika is the leading newspaper in West Bengal with a daily circulation of 10.7 lakh. However, the print media presence is mostly concentrated in Eastern India.

The group currently broadcasts four news channels- ABP News (Hindi), ABP Ananda (Bengali) and recently launched ABP Majha (Marathi) and ABP Asmita (Gujarati) with strong positions in their respective genres.

ABP was formed in 1922 with the launch of its four pages Bengali daily – ‘AnandaBazar Patrika’. Currently, ABP’s publication portfolio includes Ananda Bazar Patrika (Bengali daily), The Telegraph (English daily), E-Bela (Bengali tabloid), TTIS and other Bengali periodicals like Desh, Anandamela, Anandalok, and. ABP has state-of-the-art printing infrastructure in Kolkata and Barasat, both in West Bengal (WB).

Besides this, it has printing facilities in two other towns in WB – Barjora and Baharampur. ABP also has tie-ups with printers in Ranchi, Patna, Bhubaneswar, Siliguri and Guwahati, who execute printing orders as per ABP’s requirement.

ABP has a presence in electronic media via its wholly owned subsidiary ANN, which owns four news channels. In July 2018, ANNPL has launched ‘ABP Sanjha’ in Canada, in partnership with Parvasi Media Group, a South Asian and Punjabi media group.

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