ZEEL Reports 4% Growth In Operating Revenue In Q1 FY23

Advertising revenue increased 5% to Rs 976.3 crore from Rs 926.6 crore

Zee Entertainment Enterprises Limited (ZEEL) has reported a 4% growth in operating revenue at Rs 1845.7 crore in Q1 FY23 against Rs 1775 crore in the same quarter of the previous fiscal.

Advertising revenue increased 5% to Rs 976.3 crore from Rs 926.6 crore. Domestic ad revenue grew by 5.8% to Rs 925.7 crore. The company noted that the ad revenue growth for the quarter was impacted by FTA withdrawal (Zee Anmol) and lower ad spending by brands due to weak macroeconomic conditions.

Subscription revenue was down 5% to Rs 771.7 crore from Rs 813 crore as the pricing embargo continues to impact linear revenue growth. The company added that the subscription revenue was also impacted by the timing of some of the B2B deals and renewals.

Expenditure was up 12.5% to Rs 1610 crore from Rs 1431 crore. Operating expenses jumped 16% to Rs 1002.6 crore from Rs 866.3 crore due to higher programming and technology costs driven by higher theatrical releases, investment in ZEE5, and new launches in linear business.

Advertising expenses increased 30% to Rs 231.8 crore from Rs 178.1 crore on account of new launches in linear business and continued investments in ZEE5. Personnel cost was down 4.73% to Rs 217.2 crore during the quarter compared to Rs 228 crore.

The international business recorded ad and subscription revenues of Rs 50.6 crore and Rs 107.4 crore. Other Sales & Services income stood at Rs 23.9 crore.

ZEEL's EBITDA was down 31.5% to Rs 235.7 crore from Rs 344 crore due to slower growth in revenue and investment in content and marketing. EBITDA margin contracted to 12.8% compared to 19.4%. Net profit nosedived by 50.1% to Rs 106.6 crore from Rs 213.8 crore.

ZEEL's network market share further dropped to 16.1% from 17% in Q1 FY22. The company said that it continues to invest in Zee TV, Zee Marathi, and Zee Tamil & Movies to grow its market share. It also aims to strengthen its market position in Bangla, Telugu, and Kannada markets.

The company said that the total TV viewership at an industry level was lower due to lower Time Spent per Viewer (TSV).

ZEEL's video streaming platform recorded 43% growth in Q1 revenue at Rs 159.7 crore from Rs 111.7 crore in Q1 FY22. The platform's operating loss widened by 16% to Rs 235.2 crore from Rs 203.3 crore.

ZEE5's global Monthly Active Users (MAUs) jumped to 103.3 million in Q1 FY23 from 80.2 million in Q1 FY22. The global Daily Active Users (DAUs) were up at 11.3 million from 7.1 million. Average watch time per viewer per month grew to 196 minutes in Q1 from 190 minutes.

During the quarter, ZEE5 released 38 shows and movies including eight originals. Some of the impact releases included RRR, The Kashmir Files, Forensic, and The Broken News.

Zee Studio, the company's studio arm, released two Hindi and four regional movies during the quarter. Zee Music Company's subscriber base on YouTube increased to 85.3 million.

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