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ZEEL reported consolidated revenue of Rs. 1540.3 crore for the first quarter of fiscal 2018. Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) was Rs. 484.4 crore. PAT for the quarter was Rs. 251.6 crore. EBITDA margin for the quarter stood at 31.4 per cent.
Advertising revenue for the quarter was Rs. 966.5 crore. Adjusted for the sale of sports business and consolidation of RBNL, domestic advertising revenue grew by 6.9 per cent YoY to Rs. 868.8 crore, while international advertising revenue was Rs. 57.8 crore.
ZEEL had reported domestic advertising revenues of Rs 794.4 crore for Q4' 2017 thus seeing a 9.3 per cent increase in ad revenues in Q1'2018. This is in contrast to Q4'17, which saw a 9 per cent decrease (over previous quarter) in ad revenues due to demonetization and a 0.71 per cent decrease in domestic ad revenue (over Q2'17) in Q3'17.
The effects of demonetization can be clearly seen from how it impacted ad spends by the FMCG sector, the largest category of advertiser in the country. According to a report by global performance management company Nielsen, the Rs 2.5-lakh-crore FMCG market could take a hit of nearly 1.5 per cent of net sales, which works out to Rs 3,840 crore.
For example, FMCG giant HUL cut ad spends in Q3 as demonetization hit margins.
http://www.exchange4media.com/marketing/hul-cuts-ad-spend-in-q3-demonetisation-hits-margins_67471.html
Punit Goenka, Managing Director & Chief Executive Officer, ZEEL commented, “It was yet another satisfying quarter with a strong financial and operating performance. During the quarter, we recovered from the impact of demonetization and the growth in the first two months was strong."
On similar lines, subscription revenue for the quarter was Rs. 479.1 crore and after adjusting for the sale of sports business, domestic subscription revenue grew by 14.5 per cent to Rs. 378.8 crore while international subscription revenue stood at Rs. 100 crore.
Consolidated operating revenue for the first quarter of FY18 stood at Rs. 1540.3 crore, recording a decline of 2 per cent on YoY basis. EBITDA for the quarter ended June 30, 2017 was Rs. 484.4 crore translating into EBITDA margin of 31.4 per cent. Profit After Tax (PAT) for the quarter was Rs. 251.6 crore.
Dr. Subhash Chandra, Chairman, ZEEL, commented, “Implementation of Goods and Services Tax (GST) is a big step towards formalization of the Indian economy. This will help plug leakages in the system and the long-term benefits from this initiative will further drive the growth rate of the Indian economy. Strong economic growth and increasing share of formal sector bodes well for ad spends growth.”
“The momentum was disrupted in June in the run-up to GST implementation. The advertisers reduced ad spends on existing brands and launched fewer products as distribution chain was not fully prepared for seamless transition to the new regime. Despite the challenge, our domestic ad revenue grew by 7 per cent. Notwithstanding the short-term impact, we believe that GST will aid the advertising spends in the long-run. Our domestic subscription revenue, adjusted for the sale of sports business, grew by 14.5 per cent. While there is still uncertainty regarding the implementation of the new tariff regulation due to pending litigations, we are confident of driving the subscription business on the back of the strong competitive positions of our channels in the key genres,” further added Goenka.