Network18 Q2FY18 revenues at Rs 866 cr; GST hits ad revenues

Network18 Media & Investments Ltd has reported a 2 per cent YoY growth in its Q2FY18 consolidated revenues at Rs 866 crore (including proportionate share of JVs), compared to Rs 853 crore revenues in the corresponding quarter of last fiscal. Growth in Network18’s broadcasting business was partially offset by decline in revenues in the TV shopping business. However, a reduction in costs across both these verticals resulted in substantially lower losses. 

The quarter witnessed muted ad-revenues due to a pullback by advertisers. The deferment of ad-spends which started in mid-June continued to hurt during till mid-September. Since then, green shoots have been visible and the growth trajectory is recovering, driven by the festive season. Network18 expects the bottlenecks in GST implementation to ease in due course; and that the GST regime shall push the formal economy in the long run, boosting ad-spends. 

EBITDA on a consolidated basis, including the performance of joint ventures, for the quarter ended September 30, 2017, stood at Rs 38 crore, as against Rs 58 crore in Q2 FY17. 

Digital properties continued their ascent on the traffic charts, along with an uptick in revenues too. Network18’s digital revenues (mainly MoneyControl, News18.com and Firstpost) have grown 19 per cent YoY to Rs 31 crore. The digital industry continues to face challenges in monetisation despite traffic growth, stemming from increase in inventories due to launch of multiple platforms and a shift of traffic growth towards mobile where screen real-estate is limited. 

Commenting on the Q2 FY18’s performance, Adil Zainulbhai, Chairman of Network18, said, “With the various digital ventures in our fold, we are well positioned as the digital ecosystem grows. We are taking active steps to position each digital property so that it can expand and be successful.” 

TV18 Q2FY18 revenues up 4% at Rs 684 cr 

Meanwhile, TV18 Broadcast Ltd has posted consolidated revenues of Rs 684 crore (including proportionate share of JVs) in Q2 FY18, a 4 per cent YoY growth. Despite industry headwinds, profitability continued to improve; led by strong performance of niches, scale-up of new initiatives and cost-control. The quarter witnessed muted ad-revenues due to a pullback by advertisers. 

TV18’s share of news viewership continued its uptrend, reaching 9.3 per cent this quarter, compared to <5 per cent in Q1FY17. However, TV18 standalone (National news) revenues stayed near-flat; led by a tepid ad-environment. Meanwhile, profitability improved substantially, led by active management of operating costs which more than offset higher employee costs. Regional News continued to witness softness in earnings, partially offsetting the positives of National News. However, encouraging viewership trends bode well for Regional news. 

TV18 JVs (largely Viacom18) showed 9 per cent YoY revenue growth despite the macro-weakness, driven by the strength of the bouquet and movies released during the quarter. Profitability also improved, further helped by a scale-up in some of the new initiatives launched in Q1FY17. 

Viacom18’s share of entertainment viewership (ex-sports) stayed stable at ~10 per cent. Niche channels like Nick, Comedy Central and VH1 put in a strong show, driving advertising revenues in an otherwise adverse environment. Colors and Rishtey were in the top two in Urban and rural Hindi markets, respectively.