Zee Telefilms Net Profit at RS 425 million
Zee Telefilms Net Profit at RS 425 million
Friday - Oct 21, 2005
Televisionpoint.com Team Zee Telefilms Limited on October 20 has reported second quarter consolidated revenues of RS 3,359 million representing a 8.6% growth over the corresponding period in the previous fiscal. Profit before tax for the second quarter of the fiscal 2006 was RS 563 million while Net Profit was RS 425 million.
The consolidated operating profit, stood at RS 585 million, representing a 43.2% decline over the same period last year. Profit figures as reported are after expensing of initial investments in new activities viz. Zee Telugu, Zee Smile, Zee Sports and others, deemed essential to capture rapidly cluttering up distribution space on cable and other platforms, amounting to RS 327 million (9.7% of consolidated revenues). As a result, consolidated operating profits of continuing businesses were RS 912 million, reduced by 11.6% as compared to the corresponding quarter last year, due to such investments in new businesses.
MR Subhash Chandra, Chairman and Managing Director, stated, "Over the past decade, your Company has built a valuable portfolio of television programming assets including Zee TV, Zee Cinema, Zee News and the regional programming portfolio. Our business is global but our commitment goes right to the grassroots level, where we aim to provide fulsome entertainment to our viewers. We have therefore made fresh investments in our new channels, all covering new genres. Although this may have a short-term impact on our financial's, it further strengthens the long-term prospects of your Company."
"Your company has identified cable distribution as a thrust area for the next financial year and is gearing up for a major push in that area. We have large and well-distributed cable assets that must be leveraged using new technology platforms and positioned for much higher value realisation. A series of measures have been identified and plans are being chalked out under its new CEO, MR Jagjit Singh Kohli." MR Chandra added.
MR Pradeep Guha, CEO, commented, "There is a perceptible improvement in viewership trends of Zee Network channels. Zee Cinema has shown commendable growth and in addition to being the No. 1 movie channel, it is now the No. 2 mass entertainment channel in the country. We have also revamped our sales network and improved efficiencies in the sales process. Our forthcoming attractions include Saat Phere, Second season of Hum Paanch and Kam Ya Jyada, an exciting game show with an imported format."
Zee’s advertising revenues increased handsomely to RS 1,477 million, a 12.1% growth as compared to the corresponding quarter last fiscal. From 1QFY2006, advertising revenues are being reported net of agency commission. Similar change has been reflected in previous period revenues to make it comparable. This growth in advertising revenues was a result of higher average rates on most of the network channels.
Overall subscription revenues at RS 1,745 million, registered an increase of 4.2% over the corresponding quarter last fiscal. Domestic pay revenues stood at RS 776 million. Other sales and services, recorded a growth of 37% to RS 137 million, from RS 100 million recorded during the corresponding period last year. From 2Q FY2006, the income component of the trading of set top boxes as part of other income.
In content and broadcasting, many new initiatives were undertaken to enhance market leadership. Sinndoor – Tere Naam Ka, has been well received by audience across the country. Tumhari Disha, has picked up strongly due to a renewed interest in differentiated content. Sa Re Ga Ma Pa has continued its evolution with introduction of the new format "Challenge 2005", which has been very well received. Saat Phere, a new family soap is being launched in October and is expected to do well.
Zee Cinema, the Number 1 Hindi movie channel, has continued its remarkable run of the last two quarters and maintained its position as the number 2 mass entertainment channel. Zee Smile, the fun channel from Zee Network has continued to record improvements and is rapidly increasing its viewership.
The launch of Zee Sports has been accompanied by acquisition of many important sporting properties. Zee has won the exclusive ten-year worldwide television and sponsorship rights to league football played in India under All India Football Federation (AIFF). The first event under the AIFF is the Federation Cup starting from October 19. Zee Sport has also signed exclusive deals for live telecast of Bundesliga and Italian Serie A football matches and for WTA, Davis Cup and Fed Cup in Tennis. The Afro Asian Cricket Series was telecast live on Zee Sports and more recently, the Challenger Cup Cricket was broadcast live from Chandigarh.
The Dish TV service continues to generate good response. It is building an expanding subscriber base, which would have a positive impact on content and service revenues for the Company. The subscriber numbers have crossed 480,000 and are growing at the rate of about 3,000-3,500 per day. This is in line with our business plans. The potential subscription revenue form these subscribers, realizable after a one-year gap, would be significant.
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