Q1FY24: ZEE reports 8% YoY growth in operating revenue at Rs 1984 crore

Zee Entertainment Enterprises Limited (ZEEL) has reported a 7.6% growth in operating revenue at Rs 1983.8 crore in Q1 FY24 against Rs 1845.7 crore in the same quarter of the previous fiscal.

The company’s advertising revenue decreased by 4% to Rs 940 crore from Rs 976.3 crore. The domestic advertising revenue saw a decline of 6.4 % in Q1 FY24 at Rs 901.8 crore from Rs 976.3 crore in the corresponding quarter last year.

It said there was a muted Ad spending environment as Q1 started off on a soft note, with IPL during the first two months of the quarter, adding that green shoots emerged towards the quarter end, with early signs of Ad spends led by FMCG starting to pick up.

The subscription revenue for the company was up by 18 % from Rs 771.7 crore to Rs 907.49 crore as “it was driven by the pick up in subscription revenue post NTO 3.0 and ZEE5.”

EBITDA for Q1 FY24 stood at Rs 154.9 crore, down by 42 % from the same quarter previous year and PAT (profit after tax) was down by 97 % this quarter YoY basis.

ZEEL’s total expenditure went up from Rs 1654.1 crore to Rs 1927 crore.

On the other hand, ZEE5 saw a YoY revenue growth of 21% at Rs 194 crore.

The company said that its content continues to perform well and strong engagement is continuing

Zee Music Company (ZMC), the 2nd Largest Music Label with 137 million subscribers on YouTube, witnessed a 13% QoQ growth on video views and added three million subscribers during the quarter.

The company said that its Board of Directors at a meeting in December 2021, considered and approved the Scheme of Arrangement under Sections 230 to 232 of the Companies Act, 2013 (Scheme), whereby the Company and Bangla Entertainment Private Limited, an affiliate of Culver Max Entertainment Pvt Ltd (formerly known as Sony Pictures Networks India Private Limited), shall merge in Culver Max Entertainment Pvt Ltd.

“After receipt of requisite approvals / NOC's from shareholders and certain regulators including SEBI, CCI, ROC etc. the Company filed a petition with NCLT for approval of the Scheme which has been heard and currently reserved for final order. The order shall be effective after the NCLT approval and balänce regulatory approvals and completion of closing formalities,” it said.

The management as part of its portfolio rationalisation initiative and conditions of impending merger is in the process of either liquidating / discontinuing / selling certain entities (primarily Margo Networks Private Limited).

“Basis the same, the management has classified the investment in relation to these entities as Non-current Assets held for sale/disposal. Considering these assets are held for sale, the assets have been recorded at their realisable value, accordingly during the quarter ended 30 June 2023 and quarter and year ended 31 March 2023, the Company has recorded an impairment of Rs 211 lakhs and Rs 33,138 lakhs respectively on such assets which has been disclosed as an exceptional item.

“During the year ended 31 March 2023, the impact on consolidated financial results was Rs 9,757 lakhs as the losses incurred by such entities in the earlier financial years was recorded in the consolidated financial statements of those respective years. During the quarter ended 30 June 2023, the management of the Company has estimated liability to fund the closure costs at Rs 3,240 lakhs, which has been approved by the board subsequent to the quarter end, which has been treated as an exceptional item,” it said.

The merger related cost for Q1 FY24 stood at Rs 706.4 crore, up from Rs 149 crore last fiscal.