Release Date: May 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Hindustan Media Ventures Ltd (BOM:533217, Financial) saw a 7% increase in total revenue for Q4, reaching INR527 crores.
- EBITDA for Q4 increased substantially to INR64 crores, with margins at 12%.
- The radio business recorded a 31% revenue growth on a quarterly basis and 9% on a full-year basis.
- The digital segment showed a 37% growth in revenue for the quarter and 16% for the full year.
- The company maintains a healthy net cash balance of INR884 crores as of March 31, 2024.
Negative Points
- Circulation revenues for the print business were down 6% on a quarterly basis.
- Investments in new business verticals, particularly in the digital domain, moderated overall profitability for the year.
- The company remains cautious about ongoing global conflicts that could disrupt supply lines and impact commodity costs.
- Despite improvements, the pricing power in the market remains under pressure, affecting profitability.
- The OTT play segment is not expected to be profitable in the next financial year, with significant investments still required.
Q & A Highlights
Q: When can we expect the company to return to positive operating profit?
A: Piyush Gupta, Group CFO: The company has seen improvement in profitability due to robust control on expenses and moderated newsprint costs. However, the pricing power is still under pressure post-COVID. Investments in digital properties, notably OTT plays, are also impacting profitability. We expect margins to improve as we push pricing and the OTT product unlocks revenue.
Q: How much was the land and building sold for?
A: Piyush Gupta, Group CFO: The land and building classified as non-current assets were sold for about INR8 crores to INR10 crores. These were surplus land parcels.
Q: What is the nature of the investment property classified as non-current assets?
A: Anna Abraham, IR Contact Officer: These properties were acquired as part of the ad-for-equity business and are continuously looked for liquidation. We have made a profit on these sales.
Q: Can you provide more details about the OTT play business?
A: Piyush Gupta, Group CFO: The product market fitment for OTT has been done, and we expect revenue to increase as the product is now ready for the market. We will provide more performance details in a couple of quarters.
Q: Do you expect the OTT play to be profitable in the next few years?
A: Anna Abraham, IR Contact Officer: We do not expect the OTT play to be profitable next year as we are focusing on scaling up the business. However, investments will reduce considerably.
Q: What are your plans for the cash reserves?
A: Piyush Gupta, Group CFO: Most of the cash is being used to construct new businesses. There are no plans for dividend payouts at this time.
Q: Will the investment in the digital business reduce immediately?
A: Piyush Gupta, Group CFO: Yes, the investment will reduce drastically from this quarter, with the initial setup costs already accounted for. We expect the investment to be half of what it was last year.
Q: What were the newsprint prices this quarter?
A: Anna Abraham, IR Contact Officer: The average newsprint price was about INR50,000, a 4% decline sequentially.
Q: What is the reason for the drop in circulation revenue?
A: Anna Abraham, IR Contact Officer: The drop is due to a reduction in copies, influenced by heightened newsprint costs. We have rationalized some copies and plan to bring back productive copies.
Q: Can you share the revenue breakup of subscription and ad revenue for Digicontent?
A: Piyush Gupta, Group CFO: Most of the revenue is ad revenue in nature. Subscription revenue is growing but still a small segment.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
