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Zee Q2 Result: ZEE Q2 revenue up 25% at Rs 1,976 crore

MUMBAI: Subhash Chandra-promoted Zee Entertainment Enterprises (ZEE) has posted a strong 24.9% jump in its operating revenues in the quarter ended September 30, 2018.

Total revenue for the quarter swelled to Rs 1,975.9 crore, compared to Rs 1,582.1 crore in the corresponding quarter of the previous fiscal. The company said the growth was driven by the strong performance of domestic broadcast and other businesses.

ZEE’s operating profits or EBITDA (earnings before interest, tax, depreciation and amortization) for the quarter grew by 37.6% to Rs 675.7 crore, while EBITDA margin stood at 34.2%. In the year ago period EBITDA was at Rs 491.2 crore.

ZEE’s expenses, meanwhile, also grew by 19.2% to Rs 1,300 crore, from Rs 1,090.9 crore in the year ago period.

However, a tax expense of Rs 262.4 crore (compared to Rs 148.9 crore in the previous year quarter) dragged down ZEE’s consolidated net profit by 38.2% to Rs 386.7 crore. In the year ago period, ZEE had posted a net profit of Rs 625.5 crore.

“Our broadcast business continues to grow at an impressive pace as evident from the domestic advertising and subscription revenue growth numbers. We continue to consolidate our viewership share which is driving our market leading growth,” said Puni Goenka, MD & CEO, ZEE. “We believe that our broadcast portfolio has the potential to further increase its market share and the launch of new channel in Kerala will surely help it.”

As per Goenka, the advertising and subscription revenue growth will be aided by the scaling-up of digital business and the growth outlook for both remains strong. “This robust performance also gives us room to increase our investments in digital, if required,” he added.

Strong revenue growth

ZEE’s consolidated advertising revenues grew by 22,7% to Rs 1,210.6 crore in the quarter under review, compared to Rs 986.7 crore in the year ago period.

The company said ad revenue was driven by the robust demand across key categories for TV advertising and digital service ZEE5’s contribution to advertising revenue. While the TV advertising revenue growth was led by the continuous increase in network’s market share over the last few quarters, ZEE5’s growing user base and time-spent will aid the overall growth, ZEE said.

Total subscription revenues in Q2 grew by 21.3% to Rs 608.2 crore. The domestic subscription revenue grew at 26%, while international subscription revenue has show a marginal 1.9% improvement.

Growth of ZEE5
Since the launch of the revamped offering under the new brand ZEE5 in February, ZEE’s OTT service has been the fastest growing digital entertainment platform. ZEE claimed that it has become the No. 2 platform in India.

In September, ZEE5 had 41.3 million monthly active users (MAU), recording a growth of 190% compared to April’18. Over the same time, video views grew 340% and videos viewed per user almost doubled, leading to a significant improvement in user engagement, the company said.

At present, ZEE5 users are spending an average of 31 minutes per day on the platform as per the company.

“ZEE5 is the fastest growing entertainment platform in the country. In a little over six months, it has become the second most popular OTT platform. With a monthly active user base of 41 million and an average daily time spend of 31 minutes, it is growing faster than our expectations,” said Goenka. “Despite the strong initial performance, I believe it is just the beginning of a long digital journey for us. With a strong pipeline of original content and partnerships with key players in the digital eco-system, we are confident that ZEE5 will become the default entertainment platform for digital audience.”




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