Another year of robust performance for ZEEL: Subhash Chandra

Zee Entertainment Enterprises Limited (ZEEL) has reported consolidated revenue of Rs 20,193 million for the fourth quarter ended March 31, 2019. Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) was Rs 5,683 million, with an EBITDA margin of 28.1 per cent. Profit After Tax (PAT) for the quarter was Rs 2,917 million. 

For the full year FY2019, ZEEL reported consolidated revenue of Rs 79,339 million. EBITDA was at Rs 25,640 million, with an EBITDA margin of 32.3 per cent. PAT for the year was Rs 15,671 million, while the PAT margin was 19.8 per cent. 

Q4 FY2019 Highlights: 

• Total revenue for the quarter was Rs 20,193 million, growth of 17.0% YoY. The growth was driven by the strong performance of domestic broadcast, digital and movie businesses.
• Advertising revenue for the quarter was Rs 12,175 million, a growth of 16.0% YoY. Domestic advertising revenue grew by 17.7% YoY to Rs 11,575 million. International advertising revenue for the quarter was Rs 600 million.
• Subscription revenue for the quarter was Rs 5,653 million, growth of 3.4% YoY. Domestic subscription revenue grew by 3.9% YoY to Rs 4,696 million. International subscription revenue was Rs 957 million.
• EBITDA for the quarter grew by 12.3% to Rs 5,683 million and EBITDA margin stood at 28.1%.
• ZEE5 continued to grow and reached 61.5 million MAUs in the month of March.
• ZEEL maintained its position as the #1 all-India television entertainment network.

FY2019 Highlights: 

• Total revenue for FY19 was Rs 79,339 million, growth of 18.7% YoY. The growth was driven by the all-round strong performance of domestic broadcast, digital and movie businesses.
• Advertising revenue for FY19 was Rs 50,367 million, growth of 19.8% YoY. Domestic advertising revenue grew by 20.9% YoY to Rs 47,690 million. International advertising revenue was Rs 2,677 million.
• Subscription revenue for FY19 was Rs 23,105 million, growth of 13.9% YoY. Domestic subscription revenue grew by 17.4% YoY to Rs 19,232 million. International subscription revenue was Rs 3,873 million.
• EBITDA for FY2019 grew by 23.5% to Rs 25,640 million and EBITDA margin stood at 32.3%.
• PAT for the full year FY2019 was Rs 15,671 million and the PAT margin was 19.8%

Commenting on the performance, Subhash Chandra, Chairman, ZEEL, remarked, “This has been another year of robust performance and we have ended the year on a strong footing. With the elections behind us, I expect the economic growth to accelerate. Our M&E industry has grown tremendously over the last few years, but I believe that it is just the beginning. Entertainment content is becoming increasingly personalised and that journey will continue with the new TRAI regulation and emergence of digital medium placing consumer at the centre. This will further motivate all the content producers to create better quality content.” 

Punit Goenka, Managing Director & CEO, ZEEL, commented, “We have delivered another quarter of strong operating performance which is commendable given the challenges the industry is facing in implementing the TRAI tariff order. As I had indicated earlier, the implementation of this new regulation has led to short-term disruptions, which is understandable given the size of our pay TV market. Based on the initial signs, I do believe that the changes that this regulation will bring in will be positive for us.”  

Goenka admitted that the subscription and advertising revenues for the fourth quarter were impacted due to the tariff order. However, the medium-term growth outlook for the business remains unchanged. “While the advertisers have been circumspect to spend due to the uncertainty caused by the regulation and some moderation in the consumer demand, we believe that this is temporary. The tariff order should settle down on the ground soon and the new government’s primary objective will be to stimulate the consumer demand, both of which will inspire confidence in the advertisers. The new subscription regime would be beneficial for all the stakeholders in the value chain,” he added. 

Speaking about the performance in the digital space, Goenka said, “ZEE5 has completed one year of operations and has become one of the leading digital entertainment platforms in the country. We have significantly stepped up the pace of our new launches and the content pipeline for the next one year is firmed up. Over the last three months, ZEE5 further expanded its telecom partnerships and is now available on all the major telecom networks. We will continue to scale up ZEE5 on the three pillars of content, technology and partnerships.”