ITV

Category: Financials

  • Status Report: Q3-2016: DAS Phase III deadline no great shakes for DTH industry

    Status Report: Q3-2016: DAS Phase III deadline no great shakes for DTH industry

    BENGALURU: Contrary to expectations that the sunset date of 31 December, 2015 (Q3-2016 in financial terms in India) would rake in good numbers for the DTH industry for the quarter ended 31 December, 2015 (Q3-2015, current quarter), results declared by three of the seven players in the country show not much of a change.

    Refer to Fig A below, which shows a quarter-on-quarter change in subscriber numbers. Though Airtel DTH and Videocon d2h have both shown a small spike in subscriber additions between Q2-2016 and Q3-2016, overall taking the combined addition in subscription numbers by all the three, the change was just 3.59 per cent. In the case of the third player – Dish TV, it witnessed the lowest growth over a five quarter period starting Q3-2015 until the current quarter at 2.19 per cent

    Note: (1)100,00,000 = 100 lakh = 10 million = 1 crore.

    (2) This report covers only the three of the seven DTH service providers in India (as had the previous two reports) since the other four – Reliance Digital TV, Sun Direct (about 97 lakh subscribers as on 31 March, 2015), Tata Sky and DD Free Dish are not listed directly on the bourses and their financial numbers are not available, unless the principals of these companies/segments chose to reveal them. The three players – Airtel DTH, Dish TV and Videocon d2h have already been covered in our earlier reports.

    (3) Some of the players mention their financial as well as subscription numbers in millions in their financial reports/investor presentations and other documents that they make available publicly. The financial numbers have been converted to Rs crore and subscription number to lakh to an approximation, and percentages have been mentioned to the second decimal place approximation.

    (4) There could be some ambiguity about the market share of the three players. If one were to go by the latest numbers released by the Telecom Regulatory Authority of India (TRAI) in February 2016 for September 2015. TRAI’s indicator report says that the number of registered DTH subscribers as on 30 September, 2015 was 814.7 lakh. The combined subscription numbers of the three players as on the same day as reported by them individually was 351.16 lakh and hence the market share of these players works out to 43.10 per cent. However, TRAI’s report also says that the number of active DTH subscribers as on 30 September, 2015 was 410.5 lakh. Based on the second TRAI number, the combined total subscriber market share of the three players in this paper works out to 85.54 per cent. Though, the combined share of subscribers of the three players has declined between Q1-2016 and Q2-2016, based on TRAI numbers, the author contends that it is safe to assume that the three players have more than 50 per cent market share in India in terms of subscribers.

    (5) Videocon d2h EBIDTA numbers are adjusted.

    Although in absolute numbers, Q3-2016 saw probably the highest subscriber additions by the three players per quarter over the past few quarters, in percentage terms it was slightly lower at 3.59 per cent in the current quarter as compared to 3.62 per cent in Q1-2016. Overall, the three players in this report have mentioned a combined net addition of 12.6 lakh subscribers in Q3-2016. In Q1-2016, the three had reported a combined net addition of 11.99 lakh subscribers.

    Dish TV managing director Jawahar Goel said, “We continued to build our pan-India reach during the quarter. However, as expected, despite analogue sunset there was no real spike in consumer demand from Phase III markets thus making it an ordinary quarter from that perspective. Later, changing gears to align with the current industry trend, we tweaked our subscription packages to a more versatile and seemingly economical offering. Mandatory digitisation however is expected to pick up speed and our key focus going forward would be to gain market share both in terms of subscribers and profitability.”

    Of the three, Airtel DTH added the highest number of subscribers in Q3-2016, about six lakh subscribers. Further, among the three players, Dish TV has the largest subscriber base – about 140 lakh, followed by Videocon d2h with 112.7 lakh and Airtel DTH with 111.06 lakh subscribers. In terms of revenue, it is Dish TV that leads with the highest revenue, followed by Airtel DTH, with Videocon d2h among the 3 players in this report.

    Please refer to the figure below. Panel A indicates the combined numbers of the three players, Panels B, C and D indicate the playout of revenue, EBIDTA and subscription base for Airtel DTH, Dish TV and Videocon d2h respectively, panel E indicates ARPU and panel F monthly subscriber churn.

    Please refer to Panel A in the graphs above. The combined revenues of the three players in the current quarter grew 17.24 per cent year on year (YoY) to Rs 2,245.17 crore from Rs Rs 1,915.01 crore and grew 4.46 per cent quarter on quarter (QoQ) as compared to Rs 2149.32 crore. EBIDTA increased 41.35 per cent YoY in Q3-2016 to Rs 710.51 crore (31.65 per cent margin) from Rs 503.65 crore (26.25 per cent margin) and grew 4.44 per cent QoQ from Rs 680.30 crore (31.65 per cent margin). Reported Combined Subscription numbers in Q2-2016 grew 13.22 per cent YoY to 363.76 lakh from 321.3 lakh and grew 3.59 per cent QoQ from 351.16 lakh.

    Please refer to panel F above. All the three players have reported a monthly subscriber churn of around 0.7 per cent in the current quarter, as compared to a high of 1.3 per cent in Q2-2016.

    Airtel DTH

    Airtel’s DTH segment contributes about four per cent to the telecom giant’s overall revenue. Revenue for the DTH segment in Q3-2016 increased 19 per cent to Rs 742.2 crore, up 19 per cent YoY as compared to Rs 623.4 crore. EBIDTA for Q3-2016 grew 45 per cent to Rs 247.4 crore (33.3 per cent margin) as compared to Rs 170.7 crore (27.4 per cent margin).

    The segment’s subscriber base grew 13.2 per cent YoY to 111.06 lakh in the current quarter as compared to 98.10 lakh and grew five per cent as compared to 105.76 lakh in the immediate preceding quarter. Though in US dollar terms, average revenue per user (ARPU) was constant YoY and QoQ at $3.5, it has increased seven per cent YoY in Indian rupees to Rs 229 from Rs 214 and increased two per cent QoQ from Rs 224.

    Dish TV

    Dish TV added 3.17 lakh net subscribers (the least among the three) in the quarter ended 31 December, 2015 (Q3-2016, current quarter), taking its subscriber base on that date to 140 lakh. Dish TV is the largest DTH player in the country in terms of subscribers as well as revenue. The company reported 11.8 per cent YOY revenue growth in the current quarter at Rs 771.48 crore as compared to Rs 690.08 crore and 2.5 per cent more QoQ as compared to Rs 752.42 crore.

    The company reported 39.1 per cent EBIDTA growth in the current quarter at Rs 265.4 crore as compared to Rs 190.8 crore in the corresponding year ago quarter and 4.1 per cent more than the Rs 255 crore in the immediate trailing quarter. Dish TV reported PAT in Q3-2016 at Rs 68.49 as compared to a loss of Rs 2.63 crore in the corresponding prior year quarter, but a decline of 21.3 per cent as compared to Rs 86.96 crore in the previous quarter.

    ARPU in the current quarter declined by Rs 5 YoY to Rs 172, but increased by Rs 1 QoQ.

    Videocon d2h

    Videocon d2h added 6.7 lakh gross subscribers and 4.3 lakh net subscribers during the quarter. Gross subscribers totalled 149.5 lakh and net subscribers totalled 112.7 lakh as of 31 December, 2015.

    The company’s revenue from operations (TIO) increased 21.6 per cent YoY to Rs 731.49 crore in Q3-2016 as compared to Rs 601.53 crore, and increased six per cent QoQ from Rs 690.08 crore.

    Videocon d2h reported 42.2 per cent YoY growth in adjusted EBITDA at Rs 201 crore for Q3- 2016 compared to Rs 141 crore in the corresponding year ago quarter. Net loss for the quarter declined to Rs 22.05 crore as compared to the net loss of Rs 79.8 crore in Q3-2015.

    ARPU in Q3-2016 increased 8.2 per cent to Rs 211 as compared to Rs 195 in Q3-2015 and increased 2.9 per cent as compared to Rs 205 in Q2-2016.

    Closing remarks

    Dish TV, which is more of a value player when compared to the other two players in this report, which could be labelled a premium players in terms of subscription packages, could show even better results in terms of better subscriber acquisition and hence higher revenues over the next few quarters, considering the fact that it is tweaking its subscription packages to be more economical.

    Videocon d2h executive chairman Saurabh Dhoot said, “In the first few days of January 2016, we saw strong pick up in subscriber additions in cities that come under Phase III digitisation. Recently, a few state high courts issued a stay order on implementation of Phase III digitisation for one to three months. This was in line with our expectations of the digitisation being a staggered process.”

    “We estimate around 50 million television homes come under Phase III digitisation, of which 24-25 million television homes are already on the digital platform. Thus, the target market under Phase III digitisation is the remaining 25-26 million television homes that are currently on analogue cable,” added Dhoot.

    Investors in Indian DTH companies could heave a sigh of relief – Chrome figures recently released for the month of January 2016 reveal that the DTH industry is a major beneficiary of DAS phase III. If that is the case, then DTH players should report even better numbers for Q4-2016 and FY-2016. Another heartening revelation was made by Sun TV Network Limited (Sun TV) in its earnings release for Q3-2016. Sun TV says that its DTH business under the brand Sun Direct, revenue was up approximately 14 per cent. Subsidy costs for DTH set top boxes is going down, and that should help with improved bottom lines.

    Going on to 31 December, 2016, the sunset date for DAS IV, the DTH platform should be able to garner a big chunk of subscribers from DAS IV areas. The future seems good, let’s see how it plays out from the DTH industry’s perspective.

  • Status Report: Q3-2016: DAS Phase III deadline no great shakes for DTH industry

    Status Report: Q3-2016: DAS Phase III deadline no great shakes for DTH industry

    BENGALURU: Contrary to expectations that the sunset date of 31 December, 2015 (Q3-2016 in financial terms in India) would rake in good numbers for the DTH industry for the quarter ended 31 December, 2015 (Q3-2015, current quarter), results declared by three of the seven players in the country show not much of a change.

    Refer to Fig A below, which shows a quarter-on-quarter change in subscriber numbers. Though Airtel DTH and Videocon d2h have both shown a small spike in subscriber additions between Q2-2016 and Q3-2016, overall taking the combined addition in subscription numbers by all the three, the change was just 3.59 per cent. In the case of the third player – Dish TV, it witnessed the lowest growth over a five quarter period starting Q3-2015 until the current quarter at 2.19 per cent

    Note: (1)100,00,000 = 100 lakh = 10 million = 1 crore.

    (2) This report covers only the three of the seven DTH service providers in India (as had the previous two reports) since the other four – Reliance Digital TV, Sun Direct (about 97 lakh subscribers as on 31 March, 2015), Tata Sky and DD Free Dish are not listed directly on the bourses and their financial numbers are not available, unless the principals of these companies/segments chose to reveal them. The three players – Airtel DTH, Dish TV and Videocon d2h have already been covered in our earlier reports.

    (3) Some of the players mention their financial as well as subscription numbers in millions in their financial reports/investor presentations and other documents that they make available publicly. The financial numbers have been converted to Rs crore and subscription number to lakh to an approximation, and percentages have been mentioned to the second decimal place approximation.

    (4) There could be some ambiguity about the market share of the three players. If one were to go by the latest numbers released by the Telecom Regulatory Authority of India (TRAI) in February 2016 for September 2015. TRAI’s indicator report says that the number of registered DTH subscribers as on 30 September, 2015 was 814.7 lakh. The combined subscription numbers of the three players as on the same day as reported by them individually was 351.16 lakh and hence the market share of these players works out to 43.10 per cent. However, TRAI’s report also says that the number of active DTH subscribers as on 30 September, 2015 was 410.5 lakh. Based on the second TRAI number, the combined total subscriber market share of the three players in this paper works out to 85.54 per cent. Though, the combined share of subscribers of the three players has declined between Q1-2016 and Q2-2016, based on TRAI numbers, the author contends that it is safe to assume that the three players have more than 50 per cent market share in India in terms of subscribers.

    (5) Videocon d2h EBIDTA numbers are adjusted.

    Although in absolute numbers, Q3-2016 saw probably the highest subscriber additions by the three players per quarter over the past few quarters, in percentage terms it was slightly lower at 3.59 per cent in the current quarter as compared to 3.62 per cent in Q1-2016. Overall, the three players in this report have mentioned a combined net addition of 12.6 lakh subscribers in Q3-2016. In Q1-2016, the three had reported a combined net addition of 11.99 lakh subscribers.

    Dish TV managing director Jawahar Goel said, “We continued to build our pan-India reach during the quarter. However, as expected, despite analogue sunset there was no real spike in consumer demand from Phase III markets thus making it an ordinary quarter from that perspective. Later, changing gears to align with the current industry trend, we tweaked our subscription packages to a more versatile and seemingly economical offering. Mandatory digitisation however is expected to pick up speed and our key focus going forward would be to gain market share both in terms of subscribers and profitability.”

    Of the three, Airtel DTH added the highest number of subscribers in Q3-2016, about six lakh subscribers. Further, among the three players, Dish TV has the largest subscriber base – about 140 lakh, followed by Videocon d2h with 112.7 lakh and Airtel DTH with 111.06 lakh subscribers. In terms of revenue, it is Dish TV that leads with the highest revenue, followed by Airtel DTH, with Videocon d2h among the 3 players in this report.

    Please refer to the figure below. Panel A indicates the combined numbers of the three players, Panels B, C and D indicate the playout of revenue, EBIDTA and subscription base for Airtel DTH, Dish TV and Videocon d2h respectively, panel E indicates ARPU and panel F monthly subscriber churn.

    Please refer to Panel A in the graphs above. The combined revenues of the three players in the current quarter grew 17.24 per cent year on year (YoY) to Rs 2,245.17 crore from Rs Rs 1,915.01 crore and grew 4.46 per cent quarter on quarter (QoQ) as compared to Rs 2149.32 crore. EBIDTA increased 41.35 per cent YoY in Q3-2016 to Rs 710.51 crore (31.65 per cent margin) from Rs 503.65 crore (26.25 per cent margin) and grew 4.44 per cent QoQ from Rs 680.30 crore (31.65 per cent margin). Reported Combined Subscription numbers in Q2-2016 grew 13.22 per cent YoY to 363.76 lakh from 321.3 lakh and grew 3.59 per cent QoQ from 351.16 lakh.

    Please refer to panel F above. All the three players have reported a monthly subscriber churn of around 0.7 per cent in the current quarter, as compared to a high of 1.3 per cent in Q2-2016.

    Airtel DTH

    Airtel’s DTH segment contributes about four per cent to the telecom giant’s overall revenue. Revenue for the DTH segment in Q3-2016 increased 19 per cent to Rs 742.2 crore, up 19 per cent YoY as compared to Rs 623.4 crore. EBIDTA for Q3-2016 grew 45 per cent to Rs 247.4 crore (33.3 per cent margin) as compared to Rs 170.7 crore (27.4 per cent margin).

    The segment’s subscriber base grew 13.2 per cent YoY to 111.06 lakh in the current quarter as compared to 98.10 lakh and grew five per cent as compared to 105.76 lakh in the immediate preceding quarter. Though in US dollar terms, average revenue per user (ARPU) was constant YoY and QoQ at $3.5, it has increased seven per cent YoY in Indian rupees to Rs 229 from Rs 214 and increased two per cent QoQ from Rs 224.

    Dish TV

    Dish TV added 3.17 lakh net subscribers (the least among the three) in the quarter ended 31 December, 2015 (Q3-2016, current quarter), taking its subscriber base on that date to 140 lakh. Dish TV is the largest DTH player in the country in terms of subscribers as well as revenue. The company reported 11.8 per cent YOY revenue growth in the current quarter at Rs 771.48 crore as compared to Rs 690.08 crore and 2.5 per cent more QoQ as compared to Rs 752.42 crore.

    The company reported 39.1 per cent EBIDTA growth in the current quarter at Rs 265.4 crore as compared to Rs 190.8 crore in the corresponding year ago quarter and 4.1 per cent more than the Rs 255 crore in the immediate trailing quarter. Dish TV reported PAT in Q3-2016 at Rs 68.49 as compared to a loss of Rs 2.63 crore in the corresponding prior year quarter, but a decline of 21.3 per cent as compared to Rs 86.96 crore in the previous quarter.

    ARPU in the current quarter declined by Rs 5 YoY to Rs 172, but increased by Rs 1 QoQ.

    Videocon d2h

    Videocon d2h added 6.7 lakh gross subscribers and 4.3 lakh net subscribers during the quarter. Gross subscribers totalled 149.5 lakh and net subscribers totalled 112.7 lakh as of 31 December, 2015.

    The company’s revenue from operations (TIO) increased 21.6 per cent YoY to Rs 731.49 crore in Q3-2016 as compared to Rs 601.53 crore, and increased six per cent QoQ from Rs 690.08 crore.

    Videocon d2h reported 42.2 per cent YoY growth in adjusted EBITDA at Rs 201 crore for Q3- 2016 compared to Rs 141 crore in the corresponding year ago quarter. Net loss for the quarter declined to Rs 22.05 crore as compared to the net loss of Rs 79.8 crore in Q3-2015.

    ARPU in Q3-2016 increased 8.2 per cent to Rs 211 as compared to Rs 195 in Q3-2015 and increased 2.9 per cent as compared to Rs 205 in Q2-2016.

    Closing remarks

    Dish TV, which is more of a value player when compared to the other two players in this report, which could be labelled a premium players in terms of subscription packages, could show even better results in terms of better subscriber acquisition and hence higher revenues over the next few quarters, considering the fact that it is tweaking its subscription packages to be more economical.

    Videocon d2h executive chairman Saurabh Dhoot said, “In the first few days of January 2016, we saw strong pick up in subscriber additions in cities that come under Phase III digitisation. Recently, a few state high courts issued a stay order on implementation of Phase III digitisation for one to three months. This was in line with our expectations of the digitisation being a staggered process.”

    “We estimate around 50 million television homes come under Phase III digitisation, of which 24-25 million television homes are already on the digital platform. Thus, the target market under Phase III digitisation is the remaining 25-26 million television homes that are currently on analogue cable,” added Dhoot.

    Investors in Indian DTH companies could heave a sigh of relief – Chrome figures recently released for the month of January 2016 reveal that the DTH industry is a major beneficiary of DAS phase III. If that is the case, then DTH players should report even better numbers for Q4-2016 and FY-2016. Another heartening revelation was made by Sun TV Network Limited (Sun TV) in its earnings release for Q3-2016. Sun TV says that its DTH business under the brand Sun Direct, revenue was up approximately 14 per cent. Subsidy costs for DTH set top boxes is going down, and that should help with improved bottom lines.

    Going on to 31 December, 2016, the sunset date for DAS IV, the DTH platform should be able to garner a big chunk of subscribers from DAS IV areas. The future seems good, let’s see how it plays out from the DTH industry’s perspective.

  • Q3-2016: Activation fees boost Indian cable TV companies top & bottom lines

    Q3-2016: Activation fees boost Indian cable TV companies top & bottom lines

    BENGALURU: The Digital Addressable System (DAS) Phase III deadline has helped boost Indian cable TV companies’ top and bottom lines by way of higher than normal activation fees that they charge, and how! Be it Siti Cable, Hathway or Den Network amongst the major players in the field, the companies have reported higher revenues and profits or reduced losses for the quarter ended 31 December, 2015 (Q3-2016, current quarter). Even a regional player like Ortel saw its cable TV connections rise by 32.7 per cent, both year-on-year (YoY) and quarter-on-quarter (QoQ). It is quite likely that without the hike in activation revenue, the big three players would have reported losses.

    Another significant development that has occurred in Q3-2016 is that Siti Cable has become the largest player in terms of revenue. Until the current quarter, it was placed at number three in terms of total revenue among the four players in this report. Den now stands at number two, while Hathway is at number three. Without activation revenue, it is Den that has the highest operating revenue followed by Siti Cable, with Hathway at number three and the minnow Ortel placed at number four in Q3-2016. Please refer to Fig A below. It must be noted that Ortel’s numbers are not indicated in Fig A. Its quarterly operating revenue was in the Rs 45 – 50 crore range as compared to the Rs 300 – Rs 370 crore of the other three players mentioned in this report.

    In terms of cable subscribers, again, it is Siti Cable as well as Ortel that have added cable subscription numbers, with the Den and Hathway cable subscriber base remaining stagnant. Siti Cable added about 11 lakh subscribers in the current quarter and now stands just behind Den. Hathway has moved behind a place to number three in terms of subscriber base. Ortel’s total cable subscriber base was less than six lakh at the end of December 2015. As a part of an on-going process that began with the implementation (even before in some cases) of DAS Phase I, most multi system operators (MSOs) have been replacing analogue set-top-boxes (STBs) with digital and High Definition (HD) boxes, this report does not dwell on these replacement numbers. 

    Note: (1) 100,00,000 = 100 lakh = 10 million = 1 crore
    (2) Some figures are approximate.
    (3) Other income has not been factored in for EBIDTA in the report.
    (4) Some figures are estimates.
    (5) This report is more skewed towards the financial performance parameters in a limited way, rather than the operational and operational performance parameters of the sample companies.

    Other Revenue Streams

    Another revenue stream that is growing is wireline broadband internet (broadband). Revenue contribution from the broadband segment of each of the four companies has been increasing steadily, to the extent, that in the case of Hathway, broadband internet revenue was 26.2 per cent of operating revenue in Q2-2016 and Q3-2016. The companies have been regularly reporting increase in broadband internet subscription base. Many MSOs have been focusing on broadband internet as a growth engine for revenue and profitability because of the high average revenue per user (ARPU) that the segment brings in. Wireline Internet signals can ride on the MSOs’ existing cable fibre and they don’t have to lay fresh optics. Also, for most MSOs, it is easier to rope in existing cable subscribers for broadband internet services.

    From that point of view, Q3-2016 is an anomaly of sorts, and for this also, it is the higher than normal contribution to revenue by activation charges that is responsible. In Q3-2016, broadband revenue as percentage of operating revenue was either flat QoQ (Hathway) or has declined in the case of Siti Cable and Ortel, while it has increased marginally in the case of Den. But that does not imply that broadband revenue has declined, it is only that its contribution to overall revenue that has been affected. In absolute rupee terms, it has increased YoY and QoQ in Q3-2016 for all the four companies.

    Besides broadband, some companies such as Den have e-commerce portals and also manage a soccer team. This report does not cover those revenues.

    Cable Operations and Activation Fees, Profitability

    Cable operations revenue comprises Subscription Revenue, Activation Fees, Carriage or Placement charges and other income. Fig A1 below gives a breakup of the first three income streams of the three major players.

    Two of the four companies in this report have reported profit after tax (PAT) – Ortel and Siti Cable, while the other two have reported YoY and QoQ EBIDTA increase for the current quarter.

    Let us look at the profitable companies first from their cable operations and activation and profitability perspectives. Please refer to Fig B below.

    Siti Cable

    Last year, in Q4-2015, the Essel Group’s Dish TV reported profit for the first time and led the direct to home (DTH) industry in terms of improved numbers. The trend has continued so far. In Q3-2016, it is another Essel Group company from the carriage industry – Siti Cable that has reported profit after tax (PAT) of Rs 56 crore (15 per cent margin on operating revenue or OPREV) as compared to a loss of Rs 18.5 crore in the corresponding year ago quarter and a loss of Rs 19.4 crore in the immediate trailing quarter. The growth essentially has been driven by higher activation revenue in the current quarter due to the 11 lakh subscribers added in Q3-2016.

    Siti Cable’s activation revenue in the current quarter was almost eight times (grew 7.7 times) YoY at Rs 105 crore (28.4 per cent of OPREV) as compared to Rs 13.6 crore (6.1 per cent of OPREV) and grew by more than five times (5.4 times) QoQ as compared to Rs 19.4 crore (8.8 per cent of OPREV). EBIDTA in the current quarter more than doubled (up 2.6 times) YoY at Rs 129.9 crore as compared to Rs 50.1 crore and also more than doubled QoQ (up 2.5 times) from Rs 51.5 crore.

    Siti Cable executive director & CEO V D Wadhwa said, “Focussing on our guiding principle of creating value for all stakeholders, the company has achieved the financial turnaround for the first time in the history of the company and reported PBT of Rs 56 crore in Q3-2016 and Rs 5.1 crore for the nine months of FY16. At Siti Cable, our efforts to strive for operational excellence continue and during the quarter the company has added 1.1 million digital subscribers, over 10,000 broadband customers and achieved all-time high EBITDA growth of 159 per cent YoY. We expect this momentum to sustain in the coming quarters.”

    “We are also aggressively looking for inorganic growth opportunities in the geographies, which make strategic sense for us to expand and have acquired some networks in the western part of the country, which shall add additional 1.5 million subscribers to our existing subscriber base of 10.7 million. We strongly believe in cohesiveness among like-minded players and are actively engaged in our efforts as a consolidator in the industry,” he added.

    Ortel

    The Bibhu Prasad Rath led regional cable television and broadband internet player Ortel Communications Limited reported a 21.8 per cent YoY revenue (Total Income from Operations or TIO) at Rs 48.03 crore in the current quarter as compared to Rs 39.44 crore and 4.9 per cent QoQ growth as compared to Rs 45.79 crore. The company reported PAT in Q3-2016 at Rs 3.89 crore (8.1 per cent margin) as compared to a loss of Rs 0.1 crore in Q3-2015 and 37.5 per cent higher QoQ PAT as compared to Rs 2.83 crore (6.2 per cent margin). Ortel provides services in the Indian states of Odisha, Chhattisgarh, Andhra Pradesh, Madhya Pradesh and West Bengal.

    Ortel’s connection (activation) fees increased 32.7 per cent to Rs 1 crore as compared to Rs 0.70 crore and increased 33.8 per cent as compared to Rs 0.70 crore. Ortel’s YoY revenue generating units (RGU) grew 19 per cent to 626,475 as compared to 526,551 and increased 9.6 per cent QoQ as compared to 571,834 in Q2-2016. Cable TV RGUs increased 19.3 per cent YoY in Q3-2016 to 558,766 as compared to 468,274 and increased 10 per cent as compared to 508,171 in Q2-2016. Ortel’s YoY primary digital cable RGUs grew 33.9 per cent to 127,098 in Q3-2016 as compared to 94,926 in the corresponding prior year quarter and grew 8.3 per cent QoQ to 117,401. The company says that its cable TV penetration stood at 23.7 per cent in the current quarter.

    Ortel president and CEO Rath said, “I am delighted to share that our key strategy of LCO buyout is receiving huge response in our markets. Healthy addition to RGUs has led to strong growth of 38 per cent in bottom-line on a Q-o-Q basis. Given the strong pipeline of RGUs yet to be integrated, we are confident of improving upon this solid performance in the coming quarters.”

    “FY-2016 will be one-of-the-best-years in the history of Ortel Communications backed by record RGU additions and solid visibility for LCO buyouts in the coming year. With more than 90 per cent subscribers on ‘last mile,’ we remain committed to this model and strongly believe it will create tremendous value for all stakeholders going forward,” he added.

    Hathway

    Indian MSO Hathway Cable and Datacom Limited reported 25.6 per cent YoY growth in standalone Total Income from Operations (TIO) in Q3-2016 at Rs 300.43 crore as compared to Rs 239.15 crore and 9.6 per cent more than the Rs 270.03 crore in Q2-2016.

    Activation revenue in Q3-2016 more than tripled (3.1 times) YoY to Rs 22.3 crore as compared to Rs 7.2 crore and was almost fivefold (4.7 times) the Rs 4.5 crore in Q2-2016.

    The company’s EBIDTA (excluding other income) in Q3-2016 more than doubled (by 2.02 times) YoY to Rs 49.81 crore (16.6 per cent margin) as compared to Rs 24.58 crore (10.3 per cent margin) and increased 45.8 per cent QoQ as compared to Rs 34.15 crore (12.5 per cent margin) in the immediate trailing quarter. 

    Hathway’s loss in the current quarter reduced to Rs 32.58 crore, in Q3-2015 it was Rs 58.05 crore and in the immediate trailing quarter it was Rs 48.94 crore.

    Den Networks

    Den has reported activation revenue of Rs 86 crore in Q3-2016, more than fivefold YoY as compared to the Rs 15 crore in Q3-2015 and more the than three times the Rs 27 crore in the immediate trailing quarter. The company says that it has added nine lakh digital subscribers in the current quarter, taking its digital subscriber base to 85 lakh as compared to the 76 lakh in the previous quarter. The company had reported a digital subscriber base of 68 lakh for the Q3-2015, hence the share of its digital subscriber base has gone up from 58 per cent in Q3-2015 to 65 per cent in the current quarter. The company says that its Cable DAS ARPU has increased 3.8 per cent to Rs 80 in the current quarter as compared to Rs 77 in the immediate trailing quarter.

    Den reported a lower YoY and QoQ consolidated loss of Rs 48.37 crore in the current quarter as compared to a loss of Rs 62.60 crore in Q3-2015 and a loss of Rs 75.23 crore in the immediate trailing quarter.

    The company reported EBIDTA of Rs 42.99 crore (12.2 per cent margin) in the current quarter as compared to an operating profit of Rs 0.28 crore (0.1 per cent margin) in Q3-2015 and an operating loss of Rs 11.27 crore in the immediate trailing quarter. The company’s pre-Activation Cable EBIDTA in the current quarter was Rs 6 crore as compared to the Rs 34 crore in Q3-2015 and a negative Cable EBIDTA of Rs 5 crore in Q2-2016.

    Broadband

    As mentioned above, while broadband revenue in the current quarter has increased YoY and QoQ for all the four companies in this report, it contribution to overall revenues has gone down in the case of two companies, is stable in the case of another one and has increased fractionally in the case of fourth company. Please refer to Fig C below.

    Hathway’s Broadband subscription revenue in Q3-2016 increased 53.4 per cent YoY to Rs 78.7 crore as compared to Rs 57.7 crore and increased 9.5 per cent QoQ as compared to Rs 57.7 crore.

    Siti Cable Broadband revenue in the current quarter almost doubled (grew 99 per cent) at Rs 13.9 crore (3.8 per cent of OPREV) as compared to Rs 7 crore (3.2 per cent of OPREV) in Q3-2015 and increased 49.5 per cent QoQ as compared to Rs 9.3 crore (four per cent of OPREV).

    Den has also ramped up its broadband subscribers by 33.3 per cent to 76,000 in the current quarter from 57,000 in the immediate trailing quarter. The company’s broadband segment revenue increased by over five times YoY (5.5 times) at Rs 11.96 crore (3.4 per cent of TIO) as compared to Rs 2.17 crore (0.8 per cent of TIO) in corresponding prior year quarter and increased 58 per cent QoQ as compared to Rs 8.23 crore (three per cent of TIO). The segment’s YoY operating loss increased to Rs 19.57 crore as compared to Rs 12.37 crore, but reduced QoQ as compared to Rs 23.07 crore. The company says that broadband ARPU has declined by Rs 10 in the current quarter to Rs 760 from Rs 770 in the previous quarter.

    Den’s Broadband Post Activation EBIDTA in Q3-2016 was negative Rs 16 crore as compared to the negative Rs 11 crore in Q3-2015 and negative Rs 20 crore in Q2-2016.

    Ortel’s broadband segment reported 16.3 per cent higher revenue at Rs 8.28 crore as compared to Rs 7.12 crore in the corresponding year ago quarter and 1.7 per cent more than the Rs 8.14 crore in Q2-2016. The broadband segment reported an operating profit of Rs 4.78 crore in the current quarter as compared to Rs 4.52 crore in Q3-2015 and 9.1 per cent higher than the Rs 438 crore in Q2-2016.

    Ortel’s Rath said, “Broadband business continues to do well and remains a key focus area for us. We are working towards delivering notable growth in subscriber base, which would further augment our performance and overall profitability.”

    Concluding remarks

    With 31 December, 2016 as the sunset date for DAS phase IV, the next four quarters should be growth periods for the carriage industry – this includes cable, DTH and HITS (head-end in the sky) companies. How and how well they exploit this opportunity will decide their fate in the medium to long term. Two of the players in this report – Siti Cable and Ortel have said that they are looking at organic growth, and the growth in their subscription base over the past few quarters is a clear indication of that intent. Companies’ toplines and bottomlines will definitely grow over the next few quarters.

    Cable industry players face competition from the existing internet service players like the behemoth Airtel, which is the second largest wireline broadband player in the country after the public sector BSNL. While BSNL and the third largest wireline internet services player in the country – another public sector company MTNL, have been stagnating or losing in terms of subscribers, another MSO, a regional player, ACT Broadband is the fourth largest wireline broadband internet services company in the country. ACT had about 8.4 lakh subscribers at the end of November 2015. It has laid separate optic fibre for internet, rather than let it ride on its cable fibre network and has been canvassing for customers as a pure wireline internet services player in areas where it does not have cable subscribers.

    The race between activation fees and broadband revenue in terms of growth is likely to continue over the next few quarters, until the industry reaches maturity and activation revenues peter out. It remains to be seen how the companies will perform once the big revenue stream from activation fees dries up. Notwithstanding, the court stays that some players in carriage industry will obtain to delay the digitisation process, the next 24 months should be an interesting time for carriage ecosystem as it matures.

  • Q3-2016: Activation fees boost Indian cable TV companies top & bottom lines

    Q3-2016: Activation fees boost Indian cable TV companies top & bottom lines

    BENGALURU: The Digital Addressable System (DAS) Phase III deadline has helped boost Indian cable TV companies’ top and bottom lines by way of higher than normal activation fees that they charge, and how! Be it Siti Cable, Hathway or Den Network amongst the major players in the field, the companies have reported higher revenues and profits or reduced losses for the quarter ended 31 December, 2015 (Q3-2016, current quarter). Even a regional player like Ortel saw its cable TV connections rise by 32.7 per cent, both year-on-year (YoY) and quarter-on-quarter (QoQ). It is quite likely that without the hike in activation revenue, the big three players would have reported losses.

    Another significant development that has occurred in Q3-2016 is that Siti Cable has become the largest player in terms of revenue. Until the current quarter, it was placed at number three in terms of total revenue among the four players in this report. Den now stands at number two, while Hathway is at number three. Without activation revenue, it is Den that has the highest operating revenue followed by Siti Cable, with Hathway at number three and the minnow Ortel placed at number four in Q3-2016. Please refer to Fig A below. It must be noted that Ortel’s numbers are not indicated in Fig A. Its quarterly operating revenue was in the Rs 45 – 50 crore range as compared to the Rs 300 – Rs 370 crore of the other three players mentioned in this report.

    In terms of cable subscribers, again, it is Siti Cable as well as Ortel that have added cable subscription numbers, with the Den and Hathway cable subscriber base remaining stagnant. Siti Cable added about 11 lakh subscribers in the current quarter and now stands just behind Den. Hathway has moved behind a place to number three in terms of subscriber base. Ortel’s total cable subscriber base was less than six lakh at the end of December 2015. As a part of an on-going process that began with the implementation (even before in some cases) of DAS Phase I, most multi system operators (MSOs) have been replacing analogue set-top-boxes (STBs) with digital and High Definition (HD) boxes, this report does not dwell on these replacement numbers. 

    Note: (1) 100,00,000 = 100 lakh = 10 million = 1 crore
    (2) Some figures are approximate.
    (3) Other income has not been factored in for EBIDTA in the report.
    (4) Some figures are estimates.
    (5) This report is more skewed towards the financial performance parameters in a limited way, rather than the operational and operational performance parameters of the sample companies.

    Other Revenue Streams

    Another revenue stream that is growing is wireline broadband internet (broadband). Revenue contribution from the broadband segment of each of the four companies has been increasing steadily, to the extent, that in the case of Hathway, broadband internet revenue was 26.2 per cent of operating revenue in Q2-2016 and Q3-2016. The companies have been regularly reporting increase in broadband internet subscription base. Many MSOs have been focusing on broadband internet as a growth engine for revenue and profitability because of the high average revenue per user (ARPU) that the segment brings in. Wireline Internet signals can ride on the MSOs’ existing cable fibre and they don’t have to lay fresh optics. Also, for most MSOs, it is easier to rope in existing cable subscribers for broadband internet services.

    From that point of view, Q3-2016 is an anomaly of sorts, and for this also, it is the higher than normal contribution to revenue by activation charges that is responsible. In Q3-2016, broadband revenue as percentage of operating revenue was either flat QoQ (Hathway) or has declined in the case of Siti Cable and Ortel, while it has increased marginally in the case of Den. But that does not imply that broadband revenue has declined, it is only that its contribution to overall revenue that has been affected. In absolute rupee terms, it has increased YoY and QoQ in Q3-2016 for all the four companies.

    Besides broadband, some companies such as Den have e-commerce portals and also manage a soccer team. This report does not cover those revenues.

    Cable Operations and Activation Fees, Profitability

    Cable operations revenue comprises Subscription Revenue, Activation Fees, Carriage or Placement charges and other income. Fig A1 below gives a breakup of the first three income streams of the three major players.

    Two of the four companies in this report have reported profit after tax (PAT) – Ortel and Siti Cable, while the other two have reported YoY and QoQ EBIDTA increase for the current quarter.

    Let us look at the profitable companies first from their cable operations and activation and profitability perspectives. Please refer to Fig B below.

    Siti Cable

    Last year, in Q4-2015, the Essel Group’s Dish TV reported profit for the first time and led the direct to home (DTH) industry in terms of improved numbers. The trend has continued so far. In Q3-2016, it is another Essel Group company from the carriage industry – Siti Cable that has reported profit after tax (PAT) of Rs 56 crore (15 per cent margin on operating revenue or OPREV) as compared to a loss of Rs 18.5 crore in the corresponding year ago quarter and a loss of Rs 19.4 crore in the immediate trailing quarter. The growth essentially has been driven by higher activation revenue in the current quarter due to the 11 lakh subscribers added in Q3-2016.

    Siti Cable’s activation revenue in the current quarter was almost eight times (grew 7.7 times) YoY at Rs 105 crore (28.4 per cent of OPREV) as compared to Rs 13.6 crore (6.1 per cent of OPREV) and grew by more than five times (5.4 times) QoQ as compared to Rs 19.4 crore (8.8 per cent of OPREV). EBIDTA in the current quarter more than doubled (up 2.6 times) YoY at Rs 129.9 crore as compared to Rs 50.1 crore and also more than doubled QoQ (up 2.5 times) from Rs 51.5 crore.

    Siti Cable executive director & CEO V D Wadhwa said, “Focussing on our guiding principle of creating value for all stakeholders, the company has achieved the financial turnaround for the first time in the history of the company and reported PBT of Rs 56 crore in Q3-2016 and Rs 5.1 crore for the nine months of FY16. At Siti Cable, our efforts to strive for operational excellence continue and during the quarter the company has added 1.1 million digital subscribers, over 10,000 broadband customers and achieved all-time high EBITDA growth of 159 per cent YoY. We expect this momentum to sustain in the coming quarters.”

    “We are also aggressively looking for inorganic growth opportunities in the geographies, which make strategic sense for us to expand and have acquired some networks in the western part of the country, which shall add additional 1.5 million subscribers to our existing subscriber base of 10.7 million. We strongly believe in cohesiveness among like-minded players and are actively engaged in our efforts as a consolidator in the industry,” he added.

    Ortel

    The Bibhu Prasad Rath led regional cable television and broadband internet player Ortel Communications Limited reported a 21.8 per cent YoY revenue (Total Income from Operations or TIO) at Rs 48.03 crore in the current quarter as compared to Rs 39.44 crore and 4.9 per cent QoQ growth as compared to Rs 45.79 crore. The company reported PAT in Q3-2016 at Rs 3.89 crore (8.1 per cent margin) as compared to a loss of Rs 0.1 crore in Q3-2015 and 37.5 per cent higher QoQ PAT as compared to Rs 2.83 crore (6.2 per cent margin). Ortel provides services in the Indian states of Odisha, Chhattisgarh, Andhra Pradesh, Madhya Pradesh and West Bengal.

    Ortel’s connection (activation) fees increased 32.7 per cent to Rs 1 crore as compared to Rs 0.70 crore and increased 33.8 per cent as compared to Rs 0.70 crore. Ortel’s YoY revenue generating units (RGU) grew 19 per cent to 626,475 as compared to 526,551 and increased 9.6 per cent QoQ as compared to 571,834 in Q2-2016. Cable TV RGUs increased 19.3 per cent YoY in Q3-2016 to 558,766 as compared to 468,274 and increased 10 per cent as compared to 508,171 in Q2-2016. Ortel’s YoY primary digital cable RGUs grew 33.9 per cent to 127,098 in Q3-2016 as compared to 94,926 in the corresponding prior year quarter and grew 8.3 per cent QoQ to 117,401. The company says that its cable TV penetration stood at 23.7 per cent in the current quarter.

    Ortel president and CEO Rath said, “I am delighted to share that our key strategy of LCO buyout is receiving huge response in our markets. Healthy addition to RGUs has led to strong growth of 38 per cent in bottom-line on a Q-o-Q basis. Given the strong pipeline of RGUs yet to be integrated, we are confident of improving upon this solid performance in the coming quarters.”

    “FY-2016 will be one-of-the-best-years in the history of Ortel Communications backed by record RGU additions and solid visibility for LCO buyouts in the coming year. With more than 90 per cent subscribers on ‘last mile,’ we remain committed to this model and strongly believe it will create tremendous value for all stakeholders going forward,” he added.

    Hathway

    Indian MSO Hathway Cable and Datacom Limited reported 25.6 per cent YoY growth in standalone Total Income from Operations (TIO) in Q3-2016 at Rs 300.43 crore as compared to Rs 239.15 crore and 9.6 per cent more than the Rs 270.03 crore in Q2-2016.

    Activation revenue in Q3-2016 more than tripled (3.1 times) YoY to Rs 22.3 crore as compared to Rs 7.2 crore and was almost fivefold (4.7 times) the Rs 4.5 crore in Q2-2016.

    The company’s EBIDTA (excluding other income) in Q3-2016 more than doubled (by 2.02 times) YoY to Rs 49.81 crore (16.6 per cent margin) as compared to Rs 24.58 crore (10.3 per cent margin) and increased 45.8 per cent QoQ as compared to Rs 34.15 crore (12.5 per cent margin) in the immediate trailing quarter. 

    Hathway’s loss in the current quarter reduced to Rs 32.58 crore, in Q3-2015 it was Rs 58.05 crore and in the immediate trailing quarter it was Rs 48.94 crore.

    Den Networks

    Den has reported activation revenue of Rs 86 crore in Q3-2016, more than fivefold YoY as compared to the Rs 15 crore in Q3-2015 and more the than three times the Rs 27 crore in the immediate trailing quarter. The company says that it has added nine lakh digital subscribers in the current quarter, taking its digital subscriber base to 85 lakh as compared to the 76 lakh in the previous quarter. The company had reported a digital subscriber base of 68 lakh for the Q3-2015, hence the share of its digital subscriber base has gone up from 58 per cent in Q3-2015 to 65 per cent in the current quarter. The company says that its Cable DAS ARPU has increased 3.8 per cent to Rs 80 in the current quarter as compared to Rs 77 in the immediate trailing quarter.

    Den reported a lower YoY and QoQ consolidated loss of Rs 48.37 crore in the current quarter as compared to a loss of Rs 62.60 crore in Q3-2015 and a loss of Rs 75.23 crore in the immediate trailing quarter.

    The company reported EBIDTA of Rs 42.99 crore (12.2 per cent margin) in the current quarter as compared to an operating profit of Rs 0.28 crore (0.1 per cent margin) in Q3-2015 and an operating loss of Rs 11.27 crore in the immediate trailing quarter. The company’s pre-Activation Cable EBIDTA in the current quarter was Rs 6 crore as compared to the Rs 34 crore in Q3-2015 and a negative Cable EBIDTA of Rs 5 crore in Q2-2016.

    Broadband

    As mentioned above, while broadband revenue in the current quarter has increased YoY and QoQ for all the four companies in this report, it contribution to overall revenues has gone down in the case of two companies, is stable in the case of another one and has increased fractionally in the case of fourth company. Please refer to Fig C below.

    Hathway’s Broadband subscription revenue in Q3-2016 increased 53.4 per cent YoY to Rs 78.7 crore as compared to Rs 57.7 crore and increased 9.5 per cent QoQ as compared to Rs 57.7 crore.

    Siti Cable Broadband revenue in the current quarter almost doubled (grew 99 per cent) at Rs 13.9 crore (3.8 per cent of OPREV) as compared to Rs 7 crore (3.2 per cent of OPREV) in Q3-2015 and increased 49.5 per cent QoQ as compared to Rs 9.3 crore (four per cent of OPREV).

    Den has also ramped up its broadband subscribers by 33.3 per cent to 76,000 in the current quarter from 57,000 in the immediate trailing quarter. The company’s broadband segment revenue increased by over five times YoY (5.5 times) at Rs 11.96 crore (3.4 per cent of TIO) as compared to Rs 2.17 crore (0.8 per cent of TIO) in corresponding prior year quarter and increased 58 per cent QoQ as compared to Rs 8.23 crore (three per cent of TIO). The segment’s YoY operating loss increased to Rs 19.57 crore as compared to Rs 12.37 crore, but reduced QoQ as compared to Rs 23.07 crore. The company says that broadband ARPU has declined by Rs 10 in the current quarter to Rs 760 from Rs 770 in the previous quarter.

    Den’s Broadband Post Activation EBIDTA in Q3-2016 was negative Rs 16 crore as compared to the negative Rs 11 crore in Q3-2015 and negative Rs 20 crore in Q2-2016.

    Ortel’s broadband segment reported 16.3 per cent higher revenue at Rs 8.28 crore as compared to Rs 7.12 crore in the corresponding year ago quarter and 1.7 per cent more than the Rs 8.14 crore in Q2-2016. The broadband segment reported an operating profit of Rs 4.78 crore in the current quarter as compared to Rs 4.52 crore in Q3-2015 and 9.1 per cent higher than the Rs 438 crore in Q2-2016.

    Ortel’s Rath said, “Broadband business continues to do well and remains a key focus area for us. We are working towards delivering notable growth in subscriber base, which would further augment our performance and overall profitability.”

    Concluding remarks

    With 31 December, 2016 as the sunset date for DAS phase IV, the next four quarters should be growth periods for the carriage industry – this includes cable, DTH and HITS (head-end in the sky) companies. How and how well they exploit this opportunity will decide their fate in the medium to long term. Two of the players in this report – Siti Cable and Ortel have said that they are looking at organic growth, and the growth in their subscription base over the past few quarters is a clear indication of that intent. Companies’ toplines and bottomlines will definitely grow over the next few quarters.

    Cable industry players face competition from the existing internet service players like the behemoth Airtel, which is the second largest wireline broadband player in the country after the public sector BSNL. While BSNL and the third largest wireline internet services player in the country – another public sector company MTNL, have been stagnating or losing in terms of subscribers, another MSO, a regional player, ACT Broadband is the fourth largest wireline broadband internet services company in the country. ACT had about 8.4 lakh subscribers at the end of November 2015. It has laid separate optic fibre for internet, rather than let it ride on its cable fibre network and has been canvassing for customers as a pure wireline internet services player in areas where it does not have cable subscribers.

    The race between activation fees and broadband revenue in terms of growth is likely to continue over the next few quarters, until the industry reaches maturity and activation revenues peter out. It remains to be seen how the companies will perform once the big revenue stream from activation fees dries up. Notwithstanding, the court stays that some players in carriage industry will obtain to delay the digitisation process, the next 24 months should be an interesting time for carriage ecosystem as it matures.

  • Q2-2016: Hathway YoY revenue up 25.6%

    Q2-2016: Hathway YoY revenue up 25.6%

    BENGALURU: Indian multi system operator (MSO) Hathway Cable and Datacom Limited (Hathway) reported 25.6 per cent YoY growth in standalone Total Income from Operations (TIO) in Q3-2016 (quarter ended 31 December, 2015, current quarter) at Rs 300.43 crore as compared to Rs 239.15 crore and 9.6 per cent more than the Rs 270.03 crore in Q2-2016.

    Note: 100,00,000 = 100 lakh = 10 million = 1 crore

    All numbers in this report are standalone unless stated otherwise.

    The company’s EBIDTA (excluding other income) in Q3-2016 more than doubled (by 2.02 times) YoY to Rs 49.81 crore (16.6 per cent margin) as compared to Rs 24.58 crore (10.3 per cent margin) and increased 45.8 per cent QoQ as compared to Rs 34.15 crore (12.5 per cent margin) in the immediate trailing quarter.

    Subscription numbers, broadband, activation and placement revenue

    Hathway says that its consolidated set top box (STB) deployment reached 96 lakh subscribers (Q3-2016 addition eight lakh) as on 31 December, 2015 and that 80 per cent of its cable universe is digitised.

    Hathway consolidated broadband subscribers increased by 50,000 in Q3-2015 to 5.67 lakh.

    Cable TV subscription revenue in Q3-2016 increased 9.1 per cent YoY to Rs 108  crore as compared to Rs 99 crore and was almost flat (increased by less than 0.5 per cent) QoQ as compared to Rs 107.5 crore.

    Broadband subscription revenue in the current quarter increased 53.4 per cent YoY to Rs 78.7 crore as compared to Rs 57.7 crore and increased 9.5 per cent QoQ as compared to Rs 57.7 crore.

    Activation revenue in Q3-2016 more than tripled (3.1 times) YoY to Rs 22.3 crore as compared to Rs 7.2 crore and was almost fivefold (4.7 times) of the Rs 4.5 crore in Q2-2016.

    Placement revenue increased 8.4 per cent in the current quarter to Rs 82.2 crore as compared to Rs 75.8 crore in the corresponding prior year quarter, but declined 3.1 per cent as compared to Rs 84.8 crore in Q2-2016.

    ARPUs

    Net of taxes cable ARPU in Digital Addressable System (DAS) Phase I was Rs 102 and Phase II was Rs 83 as compared to Rs 100 and Rs 80 respectively in the immediate prior quarter.

    Hathway broadband standalone ARPUs increased 3.8 per cent QoQ from Rs 658 to Rs 683.

    Let us look at the other numbers reported by Hathway 

    Hathway’s standalone Total Expenditure in Q3-2016 increased 14.5 per cent YoY to Rs 314.27 crore (104.6 per cent of TIO) from Rs 274.39 crore (114.7 per cent margin) and increased 4.3 per cent from Rs 301.40 crore (110 per cent of TIO) in Q2-2015.

    Standalone Pay Channel cost in Q3-2016 increased 11.3 per cent to Rs 104.64 crore (34.8 per cent of TIO) from Rs 94.04 crore (39.3 per cent of TIO) and increased 6.5 per cent from Rs 98.27 crore (35.9 per cent of TIO) in Q2-2016.

    Employee Benefit Expense in Q3-2016 increased 37.4 per cent YoY to Rs 19.19 crore (6.4 per cent of TIO) from Rs 13.96 crore (5.8 per cent of TIO) in Q3-2015 and increased 6.4 per cent from Rs 17.83 crore (6.5 per cent of TIO) in Q2-2016.

  • Q2-2016: Hathway YoY revenue up 25.6%

    Q2-2016: Hathway YoY revenue up 25.6%

    BENGALURU: Indian multi system operator (MSO) Hathway Cable and Datacom Limited (Hathway) reported 25.6 per cent YoY growth in standalone Total Income from Operations (TIO) in Q3-2016 (quarter ended 31 December, 2015, current quarter) at Rs 300.43 crore as compared to Rs 239.15 crore and 9.6 per cent more than the Rs 270.03 crore in Q2-2016.

    Note: 100,00,000 = 100 lakh = 10 million = 1 crore

    All numbers in this report are standalone unless stated otherwise.

    The company’s EBIDTA (excluding other income) in Q3-2016 more than doubled (by 2.02 times) YoY to Rs 49.81 crore (16.6 per cent margin) as compared to Rs 24.58 crore (10.3 per cent margin) and increased 45.8 per cent QoQ as compared to Rs 34.15 crore (12.5 per cent margin) in the immediate trailing quarter.

    Subscription numbers, broadband, activation and placement revenue

    Hathway says that its consolidated set top box (STB) deployment reached 96 lakh subscribers (Q3-2016 addition eight lakh) as on 31 December, 2015 and that 80 per cent of its cable universe is digitised.

    Hathway consolidated broadband subscribers increased by 50,000 in Q3-2015 to 5.67 lakh.

    Cable TV subscription revenue in Q3-2016 increased 9.1 per cent YoY to Rs 108  crore as compared to Rs 99 crore and was almost flat (increased by less than 0.5 per cent) QoQ as compared to Rs 107.5 crore.

    Broadband subscription revenue in the current quarter increased 53.4 per cent YoY to Rs 78.7 crore as compared to Rs 57.7 crore and increased 9.5 per cent QoQ as compared to Rs 57.7 crore.

    Activation revenue in Q3-2016 more than tripled (3.1 times) YoY to Rs 22.3 crore as compared to Rs 7.2 crore and was almost fivefold (4.7 times) of the Rs 4.5 crore in Q2-2016.

    Placement revenue increased 8.4 per cent in the current quarter to Rs 82.2 crore as compared to Rs 75.8 crore in the corresponding prior year quarter, but declined 3.1 per cent as compared to Rs 84.8 crore in Q2-2016.

    ARPUs

    Net of taxes cable ARPU in Digital Addressable System (DAS) Phase I was Rs 102 and Phase II was Rs 83 as compared to Rs 100 and Rs 80 respectively in the immediate prior quarter.

    Hathway broadband standalone ARPUs increased 3.8 per cent QoQ from Rs 658 to Rs 683.

    Let us look at the other numbers reported by Hathway 

    Hathway’s standalone Total Expenditure in Q3-2016 increased 14.5 per cent YoY to Rs 314.27 crore (104.6 per cent of TIO) from Rs 274.39 crore (114.7 per cent margin) and increased 4.3 per cent from Rs 301.40 crore (110 per cent of TIO) in Q2-2015.

    Standalone Pay Channel cost in Q3-2016 increased 11.3 per cent to Rs 104.64 crore (34.8 per cent of TIO) from Rs 94.04 crore (39.3 per cent of TIO) and increased 6.5 per cent from Rs 98.27 crore (35.9 per cent of TIO) in Q2-2016.

    Employee Benefit Expense in Q3-2016 increased 37.4 per cent YoY to Rs 19.19 crore (6.4 per cent of TIO) from Rs 13.96 crore (5.8 per cent of TIO) in Q3-2015 and increased 6.4 per cent from Rs 17.83 crore (6.5 per cent of TIO) in Q2-2016.

  • Q3-2016: Sun TV YoY revenue & PAT up

    Q3-2016: Sun TV YoY revenue & PAT up

    BENGALURU: Sun TV Network Limited (Sun TV) reported 3.9 per cent growth in standalone revenue (Total income from operations or TIO) in Q3-2016 (quarter ended 31 December, 2015, current quarter) at Rs 574.12 crore as compared to Rs 552.44 crore in Q3-2015 and a 1.1 per cent QoQ growth from Rs 568.09 crore in Q2-2016. Including other income, Total income in the current quarter increased 4.1 per cent YoY to Rs 598.72 crore from Rs 575.03 crore and increased 1.7 per cent QoQ as compared to Rs 588.44 crore.

    The company reported 0.7 per cent higher YoY profit after tax (PAT) in the current quarter at Rs 215.59 crore (37.6 per cent margin) as compared to Rs 214.13 crore (38.8 per cent margin), but 1.7 per cent lower than the Rs 218.38 crore (38.4 per cent margin) in Q2-2016. 

    Note: 100,00,000 = 100 Lakhs = 10 million = 1 crore
    All figures in this report are standalone.

    The company in its earnings release says that advertisement revenues grew two per cent YoY in the current quarter to Rs 298.35 crore, but were one per cent lower QoQ as compared to Rs 301.37 crore in the immediate trailing quarter. It says that DTH revenue (Sun Direct) for Q3-2106 was up 14 per cent at Rs.150.88 crore.

    The Sun TV board of directors has declared a second interim dividend of Rs 2 per share (40 per cent) on a face value of Rs 5 per share. With this, the total dividend declared by the Board so far for the financial year 2015 – 16 is Rs 8 per share (160 per cent) on a face value of Rs 5 per share as against the total dividend of Rs 11.25 per share (225 per cent) on a face value of Rs 5 per share declared during the previous year ended 31 March, 2015.

    Let us look at the other numbers reported by Sun TV

    Sun TV reported EBIDTA of Rs 440.44 crore (76.7 per cent margin), which was 3 per cent higher YoY as compared to Rs 427.8 crore (77.4 per cent margin) and 1.9 per cent higher QoQ as compared to Rs 432.23 crore (76.1 per cent margin).

    Sun TV’s total expenses (TE) in the current quarter at Rs 268.43 crore (46.8 per cent of TIO) was 7.4 per cent higher YoY as compared to Rs250.05 crore (45.3 per cent of TIO) and 5.9 per cent higher QoQ as compared to Rs 253.44 crore (44.6 per cent of TIO). The company’s TE of Rs 412.1 crore (59.6 per cent of TIO) in Q1 included IPL Franchisee (Sun Risers Hyderabad) of Rs 85.05 crore (12.3 per cent of TIO), which is a non-recurring item during the other three quarters of the year. 

    Sun TV’s ‘Other Expenditure’ (OE) increased 30.6 per cent YoY to Rs 35.16 crore (6.1 per cent of TIO) as compared to Rs 26.93 crore (4.9 per cent of TIO) and was 12.3 per cent higher QoQ as compared to Rs 31.31 crore (5.5 per cent of TIO).

    Sun TV’s Employee Benefit Expense (EBE) in Q3-2016 increased 5.5 per cent YoY to Rs 58.73 crore (10.2 per cent of TIO) as compared to Rs 55.69 crore 10.1 per cent of TIO) and increased 3.2 per cent QoQ as compared to Rs 56.92 crore (10 per cent of TIO) in the immediate trailing quarter.

  • Q3-2016: Sun TV YoY revenue & PAT up

    Q3-2016: Sun TV YoY revenue & PAT up

    BENGALURU: Sun TV Network Limited (Sun TV) reported 3.9 per cent growth in standalone revenue (Total income from operations or TIO) in Q3-2016 (quarter ended 31 December, 2015, current quarter) at Rs 574.12 crore as compared to Rs 552.44 crore in Q3-2015 and a 1.1 per cent QoQ growth from Rs 568.09 crore in Q2-2016. Including other income, Total income in the current quarter increased 4.1 per cent YoY to Rs 598.72 crore from Rs 575.03 crore and increased 1.7 per cent QoQ as compared to Rs 588.44 crore.

    The company reported 0.7 per cent higher YoY profit after tax (PAT) in the current quarter at Rs 215.59 crore (37.6 per cent margin) as compared to Rs 214.13 crore (38.8 per cent margin), but 1.7 per cent lower than the Rs 218.38 crore (38.4 per cent margin) in Q2-2016. 

    Note: 100,00,000 = 100 Lakhs = 10 million = 1 crore
    All figures in this report are standalone.

    The company in its earnings release says that advertisement revenues grew two per cent YoY in the current quarter to Rs 298.35 crore, but were one per cent lower QoQ as compared to Rs 301.37 crore in the immediate trailing quarter. It says that DTH revenue (Sun Direct) for Q3-2106 was up 14 per cent at Rs.150.88 crore.

    The Sun TV board of directors has declared a second interim dividend of Rs 2 per share (40 per cent) on a face value of Rs 5 per share. With this, the total dividend declared by the Board so far for the financial year 2015 – 16 is Rs 8 per share (160 per cent) on a face value of Rs 5 per share as against the total dividend of Rs 11.25 per share (225 per cent) on a face value of Rs 5 per share declared during the previous year ended 31 March, 2015.

    Let us look at the other numbers reported by Sun TV

    Sun TV reported EBIDTA of Rs 440.44 crore (76.7 per cent margin), which was 3 per cent higher YoY as compared to Rs 427.8 crore (77.4 per cent margin) and 1.9 per cent higher QoQ as compared to Rs 432.23 crore (76.1 per cent margin).

    Sun TV’s total expenses (TE) in the current quarter at Rs 268.43 crore (46.8 per cent of TIO) was 7.4 per cent higher YoY as compared to Rs250.05 crore (45.3 per cent of TIO) and 5.9 per cent higher QoQ as compared to Rs 253.44 crore (44.6 per cent of TIO). The company’s TE of Rs 412.1 crore (59.6 per cent of TIO) in Q1 included IPL Franchisee (Sun Risers Hyderabad) of Rs 85.05 crore (12.3 per cent of TIO), which is a non-recurring item during the other three quarters of the year. 

    Sun TV’s ‘Other Expenditure’ (OE) increased 30.6 per cent YoY to Rs 35.16 crore (6.1 per cent of TIO) as compared to Rs 26.93 crore (4.9 per cent of TIO) and was 12.3 per cent higher QoQ as compared to Rs 31.31 crore (5.5 per cent of TIO).

    Sun TV’s Employee Benefit Expense (EBE) in Q3-2016 increased 5.5 per cent YoY to Rs 58.73 crore (10.2 per cent of TIO) as compared to Rs 55.69 crore 10.1 per cent of TIO) and increased 3.2 per cent QoQ as compared to Rs 56.92 crore (10 per cent of TIO) in the immediate trailing quarter.

  • Q3-2016: Tips YoY Audio Products sales up 62%

    Q3-2016: Tips YoY Audio Products sales up 62%

    BENGALURU: Tips Industries Limited (Tips) reported a 62.4 per cent growth in its Audio Products Sales to Rs 9.71 core (68.3 per cent of Total Income from Operations or TIO) in the quarter ended 31 December, 2015 (Q3-2016, current quarter) as compared to the Rs 5.98 crore (100 per cent of TIO) in Q3-2015. QoQ, Audio Product Sales grew 7.8 per cent from Rs 9.01 crore (75 per cent of TIO).

    Note: 100,00,000 = 100 lakh = 10 million = 1 crore

    Tips reported standalone TIO of Rs 14.21 in the current quarter, 2.4 times the TIO of Rs 5.98 crore in the corresponding prior year quarter and 18.4 per cent higher QoQ as compared to Rs 12.01 crore.

    The company reported profit after tax (PAT) of Rs 1.85 crore (13 per cent margin) in Q3-2016 as compared a loss of Rs 3.08 crore in Q3-2015 and 16.5 per cent higher than the profit of Rs 1.59 crore (13.2 per cent margin) in Q2-2016.

    Segment numbers

    The company’s Audio Production Sales/Income segment reported 82.4 per cent YoY higher operating profit of Rs 8.34 crore as compared to an operating profit of Rs 4.57 crore in Q3-2015 and an operating profit of Rs 7.91 crore in Q2-2016.

    Tips Film Production/Distribution (Production) segment reported revenue of Rs 4.5 crore (31.7 per cent of TIO) as compared to NIL in Q3-2015 and Rs 3 crore (25 per cent of TIO) in Q2-2013.

    Tips Production segment reported operating loss of Rs 0.33 crore in the current quarter as compared to a loss of Rs 3.45 crore in Q3-2015 and a loss of Rs 0.88 crore in the immediate trailing quarter.

    Let us look at the other numbers reported by Tips

    The company’s simple EBIDTA calculated without considering other income in the current quarter Rs 5.36 crore (37.7 per cent margin) as compared to negative EBIDTA Of Rs 0.83 crore and positive EBIDTA of Rs 4.86 crore (40.5 per cent margin) in Q2-2016.

    The company’s Total Expenses in the current quarter increased 27.5 per cent YoY to Rs 9.23 crore (64.9 per cent of TIO) as compared to Rs 7.23 crore (121 per cent of TIO) and was 21.9 per cent higher QoQ as compared to Rs 7.57 crore (63 per cent of TIO) in Q2-2016.

    Tips cost of production/distribution of films in Q3-2016 increased 46.6 per cent YoY to Rs 4.37 crore (30.8 per cent of TIO) from Rs 2.98 crore (49.9 per cent of TIO) and increased 32.2 per cent QoQ as compared to Rs 3.31 crore (27.6 per cent of TIO) in the immediate trailing quarter.

    The company’s finance costs in Q3-2016 at Rs 3.01 crore (21.2 per cent of TIO) was flat YoY at 3.01 crore (50.4 per cent of TIO), but declined nine per cent QoQ as compared to Rs 3.31 crore (27.6 per cent of TIO).

    Employee Benefit Expense in the current quarter at Rs 1.53 crore (10.7 per cent of TIO) increased 2.5 per cent YoY as compared to Rs 1.49 crore (24.9 per cent of TIO) and was 8.5 per cent higher QoQ as compared to Rs 1.41 crore (11.7 per cent of TIO) in the immediate trailing quarter.

  • Q3-2016: Tips YoY Audio Products sales up 62%

    Q3-2016: Tips YoY Audio Products sales up 62%

    BENGALURU: Tips Industries Limited (Tips) reported a 62.4 per cent growth in its Audio Products Sales to Rs 9.71 core (68.3 per cent of Total Income from Operations or TIO) in the quarter ended 31 December, 2015 (Q3-2016, current quarter) as compared to the Rs 5.98 crore (100 per cent of TIO) in Q3-2015. QoQ, Audio Product Sales grew 7.8 per cent from Rs 9.01 crore (75 per cent of TIO).

    Note: 100,00,000 = 100 lakh = 10 million = 1 crore

    Tips reported standalone TIO of Rs 14.21 in the current quarter, 2.4 times the TIO of Rs 5.98 crore in the corresponding prior year quarter and 18.4 per cent higher QoQ as compared to Rs 12.01 crore.

    The company reported profit after tax (PAT) of Rs 1.85 crore (13 per cent margin) in Q3-2016 as compared a loss of Rs 3.08 crore in Q3-2015 and 16.5 per cent higher than the profit of Rs 1.59 crore (13.2 per cent margin) in Q2-2016.

    Segment numbers

    The company’s Audio Production Sales/Income segment reported 82.4 per cent YoY higher operating profit of Rs 8.34 crore as compared to an operating profit of Rs 4.57 crore in Q3-2015 and an operating profit of Rs 7.91 crore in Q2-2016.

    Tips Film Production/Distribution (Production) segment reported revenue of Rs 4.5 crore (31.7 per cent of TIO) as compared to NIL in Q3-2015 and Rs 3 crore (25 per cent of TIO) in Q2-2013.

    Tips Production segment reported operating loss of Rs 0.33 crore in the current quarter as compared to a loss of Rs 3.45 crore in Q3-2015 and a loss of Rs 0.88 crore in the immediate trailing quarter.

    Let us look at the other numbers reported by Tips

    The company’s simple EBIDTA calculated without considering other income in the current quarter Rs 5.36 crore (37.7 per cent margin) as compared to negative EBIDTA Of Rs 0.83 crore and positive EBIDTA of Rs 4.86 crore (40.5 per cent margin) in Q2-2016.

    The company’s Total Expenses in the current quarter increased 27.5 per cent YoY to Rs 9.23 crore (64.9 per cent of TIO) as compared to Rs 7.23 crore (121 per cent of TIO) and was 21.9 per cent higher QoQ as compared to Rs 7.57 crore (63 per cent of TIO) in Q2-2016.

    Tips cost of production/distribution of films in Q3-2016 increased 46.6 per cent YoY to Rs 4.37 crore (30.8 per cent of TIO) from Rs 2.98 crore (49.9 per cent of TIO) and increased 32.2 per cent QoQ as compared to Rs 3.31 crore (27.6 per cent of TIO) in the immediate trailing quarter.

    The company’s finance costs in Q3-2016 at Rs 3.01 crore (21.2 per cent of TIO) was flat YoY at 3.01 crore (50.4 per cent of TIO), but declined nine per cent QoQ as compared to Rs 3.31 crore (27.6 per cent of TIO).

    Employee Benefit Expense in the current quarter at Rs 1.53 crore (10.7 per cent of TIO) increased 2.5 per cent YoY as compared to Rs 1.49 crore (24.9 per cent of TIO) and was 8.5 per cent higher QoQ as compared to Rs 1.41 crore (11.7 per cent of TIO) in the immediate trailing quarter.