MUMBAI: NDTV’s news business, comprising an English news channel (NDTV 24X7), a Hindi news channel (NDTV India) and a hybrid business channel NDTV Profit/ Prime, has turned profitable at the operating level for the fiscal ended 31 March 2015.
NDTV Ltd has posted a standalone profit before other income, finance cost and exceptional items of Rs 9.64 crore (Rs 96.4 million) in FY15 compared to a loss of Rs 46.96 crore (Rs 469.6 million) a year ago.
Net loss from the news business narrowed to Rs 25.58 crore (Rs 255.8 million) from Rs 53.56 crore (Rs 535.6 million) in the prior year. Removing the write-offs will result in the net loss to be at Rs 6.58 crore (Rs 65.8 million).
“We have put a lot of focus on our channels this fiscal . While NDTV 24X7 always used to be profitable, NDTV India was not and NDTV Profit used to lose a lot of money. This fiscal, 24X7 has remained profitable, and in addition, we have achieved EBITDA breakeven at NDTV Profit/Prime and NDTV India is EBITDA positive,” NDTV Group CEO Vikram Chandra told TelevisionPost.com.
“Essentially on the television side, there has been a big turnaround this year in the operating parameters,” Chandra added.
NDTV Profit/Prime continued its run of being EBITDA breakeven into its third consecutive quarter. NDTV Prime’s re-positioning as a youth audience channel with genre-specific show bands saw revenues for NDTV Profit/Prime. The channel grew 66 per cent year-on-year by attracting new and contextually integrated sponsors. it said.
Before its re-positioning as a hybrid channel, NDTV Profit reported an average annual loss of Rs 40 crore (Rs 400 million) every fiscal for three years.
Meanwhile, NDTV India, which had achieved EBITDA breakeven during the last fiscal, broke its highest revenue record for the second year in a row with sales of Rs 106 crore (Rs 1.06 billion) during FY15.
However, finance cost of Rs 20.15 crore (Rs 201.5 million), coupled with an impairment of investment in Jaiprakash Power (Rs 7.8 crore or Rs 78 million) and a write-down of deferred tax assets (Rs 11.2 Crore or Rs 112 million), has hit the profitability at net levels.
“These are couple of one-time write-offs that we have taken this year. As this was a good year, we decided to take the write-offs that we needed to take. So, we wrote off the investment in JP Power and tax assets. The latter will probably be written back in coming years,” Chandra explained.
Revenue from the news business saw a jump of 22.74 per cent to Rs 429.30 crore (Rs 4.29 billion) in FY15 as against Rs 349.77 crore (Rs 3.5 billion) in the previous fiscal.
Expenses
Expenses saw a mid single-digit (5.8 per cent) increase to Rs 419.66 crore (Rs 4.2 billion) in FY15, from Rs 396.73 crore (Rs 3.97 billion) in the earlier year. Mainly, it was production expenses, which jumped 41.7 per cent to Rs 80.51 crore (Rs 805.1 million), from Rs 56.83 crore (Rs 568.3 million) in FY14.
Employee cost was marginally (1.2 per cent) up to Rs 138.11 crore (Rs 1.38 billion), from Rs 135.52 crore (Rs 1.35 billion) in the previous fiscal, while marketing, distribution and promotional expenses were up 4.2 per cent to Rs 81.61 crore (Rs 816.1 million), from Rs 78.31 crore (Rs 783.1 million).
Standalone debt
The company’s gross standalone debt stood at Rs 161.95 crore (Rs 1.62 billion), while cash and cash equivalent stood at Rs 19.26 crore (Rs 192.6 million). Net standalone debt thus stood at Rs 142.69 crore (Rs 1.43 billion) as of 31 March.
Q4 scorecard
For the quarter ended 31 March, NDTV’s revenue from the news business saw a 33.39 per cent jump to Rs 120.34 crore (Rs 1.20 billion) compared to Rs 90.22 crore (Rs 902.2 million) a year ago. In contrast, expenses saw a 3.75 per cent rise.
Production expenses saw the biggest jump of 38 per cent to Rs 23.92 crore (Rs 239.2 million). Employee cost was up 5 per cent to Rs 33.99 crore (Rs 339.9 million).
Marketing, distribution and promotional expenses as well as operating and administrative expenses declined 2.6 and 11.04 per cent respectively during the quarter under review.
Net loss for the quarter was at Rs 10.69 crore (Rs 106.9 million), which included the exceptional write-offs.
However, at the operational level, the company posted a standalone profit (before other income, finance cost and exceptional items) of Rs 12.13 crore (Rs 121.3 million) compared to a loss of Rs 14.07 crore (Rs 140.7 million).
Consolidated business
On a consolidated basis, the e-commerce business continued to erode NDTV’s bottom line.
NDTV posted a consolidated net loss of Rs 44.03 crore (Rs 440.3 million) in the fiscal ended 31 March 2015, as against Rs 81.18 crore (Rs 811.8 million) a year ago.
Out of this, the e-commerce business alone contributed to a net loss of Rs 26 crore (Rs 260 million), while Rs 19 crore (Rs 190 million) are the write-offs (as mentioned earlier).
Chandra explained that if one takes out the exceptional items and loss on e-commerce business, NDTV is EBITDA as well as PAT (profit after tax) positive.
“We have three businesses—TV, digital [NDTV Convergence], and e-commerce, which we launched 2 years back. The television business has seen a big turnaround this fiscal, while digital has been a blowout year where revenues have grown to an all-time high Rs 107 crore (Rs 1.07 billion). In e-commerce, one will lose money in the initial years, but the business is such that the valuation goes up,” Chandra clarified.
He added, “As per accounting rules, we have to give a clubbed number in our result on a consolidated basis, so there is a loss of Rs 44.03 crore because of Rs 26 crore loss on the e-commerce business. But, we are not breaking out sweat on the e-commerce business. If you see, we have done exceptionally well in that this fiscal.”
NDTV reported consolidated EBITDA of Rs 33 crore (Rs 330 million) for the fiscal, compared to EBITDA loss of Rs 29 crore (Rs 290 million) in FY14. It also said that excluding e-commerce business, the company’s consolidated EBIDTA stands at Rs 64 crore (Rs 640 million) in FY15, as compared to an EBIDTA loss of Rs 6 crore (Rs 60 million) last year.
In the previous fiscal, e-commerce business EBITDA loss was at Rs 24 crore (Rs 240 million).
Consolidated revenue witnessed a 24.33 per cent increase to Rs 571.28 crore (Rs 5.71 billion), compared to Rs 459.48 crore (Rs 4.59 billion) in the previous fiscal. Expenses grew below 5 per cent to Rs 577.89 crore (Rs 5.78 billion) from Rs 550.91 crore (Rs 5.51 billion).
Production expenses jumped to Rs 120.25 crore (Rs 1.20 billion), or up 18.35 per cent, compared to Rs 101.61 crore (Rs 1.02 billion) in the year-ago period.
Employee cost and marketing, distribution and promotion expenses saw 4.1 and 5.6 per cent increase respectively to Rs 183.55 crore (Rs 1.83 billion) and Rs 106.57 crore (Rs 1.07 billion).
Meanwhile, the company has reported the result of three separate verticals—television and allied businesses (all the channels and non-digital and non-e-commerce business), digital business (NDTV Convergence) and e-commerce (Indianroots.com).
Television and allied business
TV and allied business has completely turned around from an EBITDA loss of Rs 18 crore (Rs 180 million) in FY14 to an EBITDA profit of Rs 42 crore (Rs 420 million) in FY15. Net loss (before exceptional items) is at Rs 4 crore (Rs 40 million), from Rs 64 crore (Rs 640 million in the year-ago period.
Digital: NDTV Convergence
All revenue streams—Web, VAS, and app—have showed healthy growth in revenues, exceeding even the company’s internal expectations, NDTV said.
NDTV Convergence clocked Rs 107 revenue (Rs 1.07 billion), at a 47 growth rate for FY15, while EBITDA and net profit from the business stood at Rs 22 crore (Rs 220 million) and Rs 11 crore (Rs 110 million) respectively.
E-commerce
NDTV said that IndianRoots.com, its e-commerce vertical, has achieved 8x gross merchandise value (GMV) to Rs 61 crore (Rs 610 million) in the current year from Rs 8 crore (Rs 80 million) last year.
Number of transactions rose five times compared to last year. Average order value (AOV) more than doubled in the current year to Rs 17,000 versus Rs 9,000 in the previous year, the company said.
The net revenue from the e-commerce business was at Rs 19 crore (Rs 190 million).
Consolidated debt
The company’s gross consolidated debt stood at Rs 167.43 crore (Rs 1.67 billion), while cash and cash equivalent stood at Rs 129.29 crore (Rs 1.29 billion). As of 31 March, net consolidated debt was at Rs 38.14 crore (Rs 381.4 million).