Dish TV achieves EBITDA margin of 57.9% under new tariff regime

MUMBAI: Dish TV India today reported first-quarter fiscal 2020 consolidated unaudited subscription revenues of Rs. 826.1 crore and operating revenue of Rs. 926.3 crore. EBITDA for the quarter stood at Rs. 536 crore.

The company achieved an EBITDA margin of 57.9% under the New Tariff Regime. The EBITDA margin stood at 29.7% in the trailing quarter.

The company’s expenditure for the quarter stood at Rs 390.2 crore. In the trailing quarter, the expenditure was Rs 983.8 crore.

In Q4 FY19, the company’s consolidated subscription revenues stood at Rs. 1308.3 crore and operating revenues of Rs. 1398.7 crore. EBITDA for the quarter stood at Rs. 415 crore.

Owing to the netting off of programming cost from revenues, to better reflect the new tariff regime, subscription and operating revenues for the quarter are not comparable with the corresponding period last year.

Net additions for the quarter stood at 209 thousand with more than half of the net additions being High Definition (HD) subscribers. The company noted that economical yet more efficient HD boxes launched some time back continue to add value to the HD net adds.

The company’s closing net subscriber base stood at 23.9 million.

In line with expectations, the company said that the subscription revenues were strengthened due to an engrossing cricket season.

Leveraging the Cricket World Cup, the company launched ‘Predict & Win’ contest for its subscribers. The contest was a huge hit and was one of the many initiatives taken during the quarter to win back and upgrade existing subscribers as well as enable new subscriber additions. All new & existing Dish TV & d2h subscribers were eligible for this contest.

Dish TV India also launched recharge offers that offered free-to-air movie and entertainment channels that were erstwhile available on DD Free Dish along with channels that showcased the entire Indian cricketing action.

The DTH operator stated that the general elections too had TV viewership going up significantly which ultimately positively impacted the subscriber additions and revenues.

Dish TV India CMD Jawahar Goel said, “Positive contribution from the Cricket World Cup and elections no doubt strengthened the first quarter performance but due credit should also be given to the team for dexterously working through the challenges thrown by the New Tariff Regime. I am glad to say that the technological challenges experienced during the migration are now a thing of the past. Majority of our subscribers are well settled in their channel combinations and Dish TV India should continue to raise the bar both in terms of service delivery and financial performance in the coming quarters.”

The company noted that Fiscal 2020 is going to be the first full year of the Tariff Order implementation and should witness its positive impact as well. Dish TV India strongly believes that the New Regulatory Regime will enable large distribution players like itself to emerge stronger than ever before.

Speaking on that, Dish TV India Group CEO Anil Dua said, “The Tariff Order has led to the beginning of a new era with programming cost becoming a pass-through expense. Apart from the accounting significance, the move indicates a massive shift from the traditional way of content negotiation. With the New Regime emphasizing the role of ala-carte, content would be subject to subscriber’s filtration. As a distributor, we would only be procuring content that sells while adding value through our packaging, quality of our service and new products.”

Unlike fiscal 2019 that saw the television industry struggle with challenges at the regulatory front, the current year is expected to be much more settled. The steep learning curve has ultimately brought players on a common ground which should be beneficial for the overall growth and expansion of all.

“A lot of hard work has been put in by all players, be it broadcasters, MSOs, LCOs or DTH platforms, to prepare for the New Regulatory Regime. The TRAI also went all out to ensure a smooth implementation of the Regulation and in the process has acquired significant data insight that should be leveraged to ensure better pricing and higher consumption of channels going forward,” said Goel.

The believes that the government’s thrust on social spending and upliftment should improve consumer sentiment thus benefitting consumer sector companies like Dish TV India Limited.

It further stated that primary drivers of DTH like the ever-increasing TV & multi-TV households and increasing urbanisation should continuously fuel sustainable growth in the DTH space.

Moreover, potential tie-ups and innovations in the category should reinforce DTH progression going forward, Dish TV stated.

“Having jump-started the year, we find ourselves all set to leverage the possibility of multiple growth opportunities ahead. In the near term, operating efficiencies resulting from the further realisation of synergies due to the combination of Dish TV and d2h should continue to positively contribute to the business and financial performance of the Company,” said Dua.

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