NEW DELHI/MUMBAI: The Subhash Chandra-promoted Zee Telefilms today reported higher consolidated revenues of Rs 3,359 million for the quarter ended 30 September, but a 38 per cent reduction in net profit due to increased investments in marketing and programming.
The operating profit for Q2 2006 was Rs 912 million, lower by 11.6 per cent due to higher investments in marketing and programming, while operating loss on new businesses was to the tune of Rs.327 million. Net profit was down to Rs. 425 million.
The numbers as published are after consolidating the financials of ETC Networks Limited (ETC) for the second quarter of FY2006. Since Zee has divested its stake in Padmalaya, for a like-to-like comparison, the company has excluded the financials of Padmalaya from 2Q FY2005.
According to Zee Telefilms CMD Subhash Chandra, "Over the past decade, the company has built a valuable portfolio of television programming assets including Zee TV, Zee Cinema, Zee News and the regional programming portfolio. Our business is global but our commitment goes right to the grassroots level, where we aim to provide fulsome entertainment to our viewers.
“We have therefore made fresh investments in our new channels, all covering new genres. Although this may have a short-term impact on our financials, it further strengthens the long-term prospects."
Chandra also said that the company has identified cable distribution as a thrust area for the next financial year and is gearing up for a major push in that area. “A series of measures have been identified and plans are being chalked out under its (Siti cable, the cable company) new CEO, Mr. Jagjit Singh Kohli."
Zee Tele CEO Pradeep Guha said that there is a perceptible improvement in viewership trend of Zee Network channels.
Zee’s revenues are generated primarily from advertising sales and subscription revenues. Other sales and services include revenues from film production and distribution, syndication, education sales and sale of set top boxes.
Zee’s advertising revenues increased in Q2 to Rs 1,477 million, a 12.1 per cent growth as compared to the corresponding quarter last fiscal. From Q1 2006, advertising revenues are being reported net of agency commission.
Overall subscription revenues at Rs 1,745 million, registering an increase of 4.2 per cent over the corresponding quarter last fiscal. Domestic pay revenues stood at Rs 776 million.
