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Business Scenario
The quarter under review has been a significant leap towards achieving 6-7% annual GDP growth estimate. A growth of 7.9% yoy in the September quarter has been the fastest in last six quarters. Global recovery is, however, widely perceived to remain slow and gradual.
Revenues of the Corporate houses has started showing an improvement in the current quarter. The continuous efforts to increase the operational efficiency have helped to achieve the profitability to many Corporates.
Media & Entertainment
Industry (M & E Industry)
The M & E Industry is expected to achieve a decent CAGR growth of 12.5% over next 5 years. The outlook for short to medium term remains buoyant inspite of short-term concern. Print is expected to grow at 9%, Radio at 14.2% and Internet by 28.1% over next 5 years. The print medium will continue to maintain its dominance with a major share of the advertisement pie. Radio and Internet will be amongst the fastest growing segments for the next 5 years (Source: FICCI Frames 2009).
Management Analysis
Standalone financials
As the Publishing business of the company has been transferred to Midday Infomedia Limited w.e.f July 1, 2008, there are no operating revenues and expenses for the reporting quarter. The quarter numbers represent income & expense from financial and investment activities.
Other income of Rs 71 Lakh mainly represents interest income on loan given to Radio Mid-Day West (India) Limited. It was Rs 152 Lakh during last year.
Other Administrative expenses of Rs 12 Lakh as against Rs 8 Lakh during Q3 FY 2008-09 represent legal and professional charges for the quarter.
The interest and finance cost for the quarter is at Rs 28 Lakh as against Rs 32 Lakh during Q3 FY 2008-09.
As a result, the Company has recorded a Net Profit after Tax of Rs 21 Lakh for the quarter as against Rs 113 Lakh during Q3 FY 2008-09.
Group
Financials
Q3 Results Analysis
At Group level, the Net Income from the operations is at Rs 3,264 Lakh as against Rs 3,224 Lakh of Q3 FY 2008-09 and 9% over previous quarter.
The Cost of Printing has substantially declined by 52% from Rs 1,174 Lakh in Q3 FY 2008-09 to Rs 568 Lakh in Q3 FY 2009-10 mainly due to lower newsprint prices.
Other Expenditures are at Rs 281 Lakh in Q3 FY 2009-10 as compared to Rs 240 Lakh in Q3 FY 2008-09.
As a result, Gross Profit has shown an improvement of 33% in the current quarter under review and is at Rs 2,415 as compared to Rs 1,809 Lakh in Q3 FY 2008-09
General Administrative expenses are decreased by 17% from Rs 1,868 Lakh in Q3 FY 2008-09 to Rs 1,551 Lakh in Q3 FY 2009-10 due to rationalisation of fixed cost across both the business segments.
Selling & Distribution expenses are lower by 26% from Rs 324 Lakh in Q3 FY 2008-09 to Rs 239 Lakh in Q3 FY 2009-10.
Depreciation (including amortisation) cost is at Rs 356 Lakh in Q3 FY 2009-10 as compared to Rs 355 Lakh in Q3 FY 2008-09.
As a result, the Operating Profit before Interest and Taxes has turned positive and is at Rs 268 Lakh in the current quarter as compared to an Operating Loss before Interest and Tax of Rs 738 Lakh for Q3 FY 2008-09. Operating Profitability has shown a significant improvement of 136% in the quarter under review as compared to the Q3 FY 2008-09.
Interest and Finance charges are at Rs 256 Lakh in Q3 FY 2009-10 as compared to Rs 286 Lakh in Q3 FY 2008-09 due to the lower debt exposure.
In the current quarter, the group has recorded Other Income of Rs 18 Lakh as compared to Rs 13 Lakh in Q3 FY 2008-09.
There are no extraordinary items in the current quarter as against Rs 46 Lakh in Q3 FY 2008-09.
Profit after tax and extra ordinary items have turned positive and are at Rs 26 Lakh as compared to a loss of Rs 650 Lakh in the corresponding quarter in FY 2008-09.
Nine months ended Results snap short
In FY 2009-10 Group level revenues for nine months ended are down by 10% at Rs 9,318 Lakh as compared to Rs 10,303 Lakh in corresponding period in FY 2008-09.
For the period under review Net Loss at Group Level is down by 92% from Rs 3,222 to Rs 254 as compared to FY 2008-09
Segment
Performance:
Publishing
Segment:
Q3 Results Snap Short
Revenues have registered a growth of 4% from Rs 2,466 Lakh in Q3 of FY 2008-09 to Rs 2,554 Lakh mainly due to higher advertising revenue.
Profit before Interest & Tax has increased by more than 250% and is at Rs 616 Lakh as against loss of Rs 384 Lakh in Q3 FY 2008-09.
Nine months ended Results Snap Short
In Nine months ended FY 2009-10 Revenues are down by 12% and are at Rs 7,092 Lakh as compared to Rs. 8,082 Lakh in nine months ended FY 2008-09.
Profit before interest & tax has turned positive and improved by 328% in nine months ended FY 2009-10 and is at Rs 1,345 Lakh as compared to a negative Profit before interest & tax of Rs 591 Lakh in nine months ended FY 2008-09.
Radio Segment
Q3 Results Snap Short
Revenues have are shown a decline of 5% from Rs 758 Lakh in Q3 of FY 2008-09 to Rs 724 Lakh.
Loss before interest and tax for Q3 FY 2009-10 is at Rs 339 Lakh as against Rs 354 Lakh in Q3 FY 2008-09.
Nine months ended Results Snap Short
Revenues for the period under review are at Rs 2,240 Lakh as compared to Rs 2,224 Lakh for the same period in FY 2008-09.
Loss before interest and tax for nine months ended FY 2009-10 is at Rs 1,028 Lakh as against Rs 1,015 Lakh for the same period in FY 2007-08.
Key milestones achieved:
- Q3 Group PAT turned Positive
- Q to Q Publishing PBT up by 112%
- Q to Q Publishing Revenue up by 16%
- Radio EBITDA is up by 16% for Q3
Going Forward
Publishing
The advertisement volumes are still under pressure as the Corporate World has still not recovered from the economic slow down. The Publishing segment is back on profitability path due to continuous efforts made to improve operational efficiency, fixed cost and favorable newsprint prices. Company has placed cost rationalisation and optimum usage of tangible and intangible assets as a core strategy to remain profitable in the depressed advertising market.
Radio
The revenue and listernership growth will continue to remain as a key agenda for the Radio business along with constant focus on keeping cost under control. |
