 "Network18 posts net loss of Rs 49 cr in Q1")
Media and entertainment company Network18’s consolidated revenue for the quarter ended 30th June stood at Rs 351.9 crores as compared to Rs 411.1 crores in the corresponding quarter last year. Operating loss on a consolidated basis was Rs 88.7 crores as against Rs 63.4 crores in the quarter ended 30th June 2015.
During the quarter the company made aggressive investments in new channel launches and relaunches of existing ones, on talent and various digital businesses. These initiatives reflect in lower profitability for the quarter. Net loss on a consolidated basis stood at Rs 49 crores compared to a profit of Rs 44.1 crore in Q1FY16. The loss excluding the impact of the new initiatives is Rs 24.6 crores. Last year, the company sold its entire stake in Stargaze Entertainment (the cinema exhibition business) for Rs 43.3 crore, which contributed significantly to profitability.
The new launches include Viacom18’s digital content streaming app and website VOOT, three news channels – News18 Kerala, News18 Tamil Nadu and News18 Assam/N.E., Hindi movie channel Rishtey Cineplex, and HD channels in Kannada, Marathi and Bangla. The company’s JV with Viacom, Viacom18, also announced the launch of a second Kannada GEC last week. The news channels accounted for Rs 13.9 crore loss, and the entertainment channels and VOOT for Rs 29.2 crore.
Adil Zainulbhai, Chairman, stated: “We are bullish about media – both linear and digital — and are investing heavily in most of our businesses to position them for leadership. We are investing aggressively in upgrading existing properties and launching new news & entertainment properties to enable our businesses to be ahead of the curve. We are also investing in our digital businesses. The results of these investments are starting to bear fruit and will help in healthy revenue growth and profits in the near future.”
The company's stock on BSE fell 8.76% on the day of the results' announcement, ending trading at Rs 43.2 (opened at Rs 47.8).