Q1: ZEEL reports 8.86% drop in revenue at Rs 1808.56 crore
Second wave of COVID-19 hits ad revenue that witnessed a drop of 17.49% compared to the quarter ended March 31, 2021
Media giant Zee Entertainment Enterprises Ltd has reported a consolidated net profit of Rs 208.78 crore for the quarter ended June 30, 2021, against Rs 272.36 crore for the quarter ended on March 31, 2021, and Rs 29.28 crore for the quarter ended on June 30, 2020.
The consolidated revenue stood at Rs 1808. 56 crore in the quarter against Rs 1984.39 for the quarter ended March 31, 2021 and Rs 1338.41 for the same quarter last year. This is a decrease of 8.86% compared to the March quarter and an increase of 35.13% as compared to same quarter last year.
During the quarter, the company witnessed a drop of 17.49% in ad revenue to Rs 926.61crore against Rs 1122.96 crore for the quarter ended Mar 31, 2021. Whereas ZEEL witnessed a growth of 120.07% in ad revenue as compared to the same quarter last year.
The company, in a BSE filing, said that domestic ad revenues for both Q1FY22 and Q1FY21 were impacted by lockdowns. However, the impact this year was much lower, reflected in 127.9% YoY growth. Compared to Q1FY20, domestic ad revenues were lower by 22.7%.
“The impact on the results for the quarter ended 30 June 2021 is primarily due to restrictions caused by COVID-19 on business activities. Hence, the results for the quarter ended 30 June 2021 are not strictly comparable with the results of the earlier periods presented. Since early March 2021, India has witnessed a second wave of COVID-19. This has again lead to imposing lockdown-like restrictions across the country, which is likely to impact the economic activity.”
During the quarter, the company’s subscription revenue posted an increase of 1.21% to Rs 813.05 crore against Rs 803.35 crore for the quarter ended on March 31, 2021. The company said, “Embargo on pricing change due to NTO 2.0 litigation continued to hurt domestic television pay revenue growth. The 2% growth over Q1FY21 is driven primarily by digital business.”
Additionally, the programming cost increased YoY as original content production largely continued across the states during the lockdown at alternate locations. The company said, “During the quarter, on account of the ongoing COVID-19 pandemic, the Group has incurred additional costs aggregating Rs 2,706 lakhs relating to shifting shooting locations to ensure uninterrupted operations.”
On the other sales and services, Zee posted revenue of Rs 35.32 crore against Rs 39.51 crore for the quarter ended on Mar 31, 2021. While the company posted a revenue of Rs 146.63 crore in the previous quarter last year. The drop in revenue is on account of a large movie syndication deal in the previous year,” read the company statement.
The company also informed that over 30 new shows are to be launched across the network in Q2 (Broadcast business) to help improve viewership share. The network’s TV reach and impressions grew by 7% and 9% QoQ. “With lockdowns in most states, TV viewership again jumped during the quarter, though lower than Q1 of last year.” On the other hand, the ZEE network share dropped 190bps QoQ. The company said that the network share dropped due to lockdown disruption and soft performance in some markets.
