Zee Entertainment Enterprises Ltd (ZEEL), which operates channels such as Zee TV and Zee Cinema, reported an 84.8% decline in net profit for the March quarter, despite a 12.9% growth in operating revenue.

Net profit fell to Rs231 crore during January-March quarter from Rs1,515.2 crore in the year-ago period, as operating revenue rose to Rs1,725.3 crore from Rs1,528 crore. Overall expenditure rose 15.08% to Rs1,219.1 crore from Rs1,059.3 crore.

During the quarter, ZEE’s advertising revenue rose 23.9% to Rs1,049.6 crore from Rs846.9 crore. Adjusted for sports, domestic advertising grew by 24.9% to Rs983.4 crore. On a comparable basis (excluding sports, Reliance Broadcast Network Ltd and India Webportal Pvt Ltd), domestic advertising revenue grew by 21.5%. International advertising revenue for the quarter was Rs66.2 crore. Revenue from subscriptions declined by 2% to Rs546.5 crore. Adjusted for the sale of sports business, however, domestic subscription revenue grew by 18.1% to Rs452.1 crore. International subscription revenue dropped to Rs94.4 crore.

“We are delighted with the strong operating and financial performance during the quarter,” said Punit Goenka, managing director and chief executive officer, ZEEL, in a statement. “Domestic ad revenue growth of 24% is driven by broad based recovery in advertising spends. With high visibility of product campaigns, improving consumer demand and GST (goods and services tax) related benefits trickling down to ad spends, we are confident of continued traction in advertising spending. The full-year domestic subscription revenue growth of 12% is a tad lower than our initial expectations due to some unforeseen events. However, there is no change in our medium-term outlook for the same.”

 “We are happy with the initial response (to ZEE5) and are confident that the sheer depth and breadth of our content offering will enable it to become the number one digital entertainment platform in India,” Goenka said. “We have also focused on the peculiarities of the Indian market and designed technological features to improve the user experience. Unlike most of the existing apps which are either focused on the English-speaking segment or the youth audience, ZEE5’s vast content catalogue is designed with an objective to cater to all sections of video viewing audience.” – Live Mint