TV18 Q2 EBITDA up 42% due to improved performance by regional channels
MUMBAI: TV18 Broadcast has reported a 42% jump in consolidated operating EBITDA to Rs. 108 crore in Q2FY19 driven by improved performance of regional channels including news and entertainment and despite gestation losses of Colors Tamil and new launch Colors Kannada Cinema.
While headline operating revenue grew 11% (on a comparable basis), revenue ex-movies grew 17% YoY, underscoring tailwinds in broadcasting. The consolidated operating revenue jumped to Rs 1198 crore compared to Rs 1084 crore.
Advertising revenue for TV18 grew at 18% YoY overall. Regional channels across news and entertainment drove viewership growth and ad-revenues for the portfolio, reducing our dependence on national channels.
The company noted that the industry ad-environment has substantially improved compared with the previous year, though certain pockets of the market (mobiles, auto, colas, etc) are yet to resume advertising full-throttle. Broad-based growth in regional markets and upcoming festive season are positives.
Subscription revenue grew 16% YoY to Rs 347 crore. The company is in negotiations with two of India’s leading DTH players for long-term deals on terms commensurate with the strength of our channel bouquet.
Network18 chairman Adil Zainulbhai said, “TV18’s investments into regional have served to diversify our portfolio and reduce dependence on national markets. Our rising viewership in regional channels across both news and entertainment has been the primary driver this quarter. We shall continue to invest in the broadcasting space to capture growth opportunities.”
Operating EBITDA from the entertainment segment (Viacom18 + IndiaCast) increased 12% to Rs 85 crore from Rs 76 crore a year ago. The operating revenue from the segment was up 6% at Rs 903 crore from Rs 855 crore.
Excluding movies, the entertainment segment registered 13% growth in revenue. In Q2FY19, the movie production/distribution revenue was Rs 43 Cr, vs Rs 94 Cr in Q2FY18.
The company stated that a shift of some high-impact non-fiction programming towards the festive season in H2 was implemented to improve monetisation, which impacted topline growth in Q2 but improved margins.
The entertainment EBITDA includes operating loss of Rs 25 crore on account of new initiatives – Colors Tamil (launched in mid-Q4FY18) and Colors Kannada Cinema (launched recently). Adjusting for operating losses of new initiatives (i.e. launches made over past 4 quarters), BAU margins for entertainment grew to 12.1% from 8.9% in Q2FY18.
Backed by government/election-related ad-spends rose, the gestation losses from channels launched over FY15-17 has seen substantial reduction. The regional news + infotainment cluster slashed its operating losses by 70% YoY to Rs 8 crore. Revenue jumped 36% to Rs 95 crore from Rs 70 crore.
TV18 standalone EBITDA comprising English + business news channels has jumped 10% to Rs 31 crore. The revenue registered a 26% increase to Rs 200 crore.