Category: Financials

Q1-2016: Godrej Consumer Products y-o-y marketing spend flat at Rs 251 crore

BENGALURU: Godrej Consumer Products Limited (GCPL) reported almost flat (0.4 per cent increment) advertisement and publicity expenses in Q1-2016 (quarter ended June 31, 2015) at Rs 251.12 crore (12 per cent of net Total Income from Operations or TIO) as compared to the Rs 250.20 crore (13.2 per cent of TIO) in Q1-2015. GCPL’s ad spends in Q1-2016 was 9.1 per cent more than the Rs 230.18 crore (11 per cent of TIO) in the immediate trailing quarter. Last quarter (Q4-2015), the company in its earnings release said that its household insecticides brand Good Knight crossed the Rs 1500 crore mark and amongst GPCL’s soap brands, Godrej No. 1 crossed the Rs 1,000 crore and Cinthol, the Rs 500 crore milestone.

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

Godrej group chairman Adi Godrej said, “We have had an encouraging start to FY-2016 and have delivered strong volume led growth coupled with robust profit growth. We continue to grow ahead of the market gaining share across our key categories and geographies. We continued to strengthen our leadership position across our core categories. In the first quarter, our India business branded net sales grew by 13 per cent. This was driven by a healthy volume growth of 13 per cent. Our international business (in organic constant currency terms) too grew by 13 per cent, despite the macro challenges and slowdown in a few of our larger markets. Our consolidated EBITDA (in organic constant currency terms) grew by 32 per cent. This was aided by lower commodity costs, the impact of our cost transformation programs and effective leveraging of our brand platforms.”

“We are seeing early signs of consumer demand picking up in India. We remain optimistic that as the economy continues to gain pace, the growth in the FMCG sector this year will be better than last year. Though the macro-economic environment in some of our international markets remains challenging, we are confident of delivering ahead ofmarket, profitable growth in these geographies. We will accelerate the pace of new launches and enhance our go to market infrastructure. We will also continue to manage our costs prudently in the near term, while investing for the future. Overall, we will strive to deliver a stronger operating performance in fiscal year 2016,” he added.

The medium and long-term growth prospects in India and our other emerging markets remain robust. We believe that there is still a lot of headroom for growth across these markets, given the low penetration and consumption rates in our core categories. I am confident that with our clear strategic focus, differentiated product portfolio, superiorexecution and top-notch team, we will continue to deliver industry-leading results in the future,” he said.

Trends

Please refer to Fig A below. GCPL’s Q1-2016 Ad spends mentioned above was the highest in absolute rupees during the 13 quarter period starting Q1-2013 until Q1-2016. Its highest Ad spend in terms of percentage of TIO was in Q1-2014 at 13.8 per cent (Rs 239.06 crore). During the period under consideration in this report, its lowest Ad spends both in absolute rupees and in terms of percentage of TIO was in Q2-2014 at Rs 145.78 crore and 7.5 per cent.

During the period under consideration in this report, Ad spends in terms of absolute rupees and percentage of TIO shows a linear increasing trend as indicated by the broken blue and maroon trend lines in Fig A below.

GCPL reported 11.1 per cent growth in TIO in Q1-2016 at Rs 2097.66 crore as compared to the Rs 1888.51 crore in Q1-2015 and almost flat (0.3 per cent more) than the Rs 2092.02 crore in Q4-2015. During the thirteen quarter period under consideration in this report, TIO shows a linear increasing trend as indicated by the broken green trend line.

Profit after tax (PAT) in Q1-2016 at Rs 199.23 crore (9.5 per cent of TIO) was 38.9 per cent more than the Rs 143.45 crore (7.6 per cent of TIO) in Q1-2015 but was 25 per cent less than the Rs 265.57 crore (12.7 per cent of TIO) in the immediate preceding quarter. During the thirteen quarter period in this report, PAT shows a linear increasing trend both in terms of absolute rupees and percentage of TIO as in obvious from the broken red and black trend lines in Fig B below.

Category review by GPCL

Household Insecticides

The company says that its Household Insecticides continued to deliver a strong performance, with a double-digit, volume-led sales growth of 15 per cent. This was aided by the success of new launches and deeper penetration. GPCL’s focus on innovation, backed by superior execution, resulted in market share gains across formats. The company says that it recorded its highest ever overall market share this quarter. Gross margins benefited from lower crude oil prices and have improved significantly.

Soaps

GPCL’s says that its Soaps business sustained its healthy momentum, with a double-digit volume and mix driven sales growth of 13 per cent. Cinthol’s strategy of focusing on functional benefits in the premium segment, supported by 360-degree activations, delivered encouraging results. Godrej No. 1 continued its positive momentum, led by its re-launch and new positioning as ‘India’s No.1 purest soap’. Gross margins during the quarter benefited from lower palm oil prices and have improved significantly.

Hair Colours

The company says that its Hair Colours delivered a consistent, double-digit, volume driven sales growth of 12 per cent. Godrej Expert Rich Cr?me continued to gain market share due to increased penetration.Nupur Coconut Henna Cr?me, launched this quarter, has been introduced to address the demand from herbal-based powder users and up-trade existing hair colour users.

Air Fresheners

GPCL says that Godrej aer, its air freshener brand continues its strong sales and distribution ramp up. This has been aided by innovative gel format technology and various consumer engagement initiatives. aer is now the number three player in the air care market. The company says that it continues to focus on increasing distribution and driving consumption.

Health and Wellness

The company claims that its Health and Wellness portfolio of hand washes, a hand sanitiser and anti-mosquito spray, under Godrej Protekt, continues to be well received in modern trade.

July 30, 2015
Q2-2015: Maggi ban hits Nestle for a loss of Rs 64.4 crores

BENGALURU: In what is probably a first, Nestle India Limited (Nestle) has reported a loss. A loss to the extent of Rs 64.4 crore in the quarter ended 30 June, 2015 (Q2-2015, Nestle’s financial year ends on 31 December). Hit by the Maggi Noodles controversy, exceptional items worth Rs 451.66 crore have wiped off the Rs 333.1 crore profit before exceptional items and tax that the company had earned.

The resulting loss of Rs 118.56 crore was mitigated by a tax credit of Rs 54.16 crore and the result was the above mentioned net loss of Rs 64.4 crore.

Last quarter, the company had reported a profit after tax (PAT) of Rs 320.28 crore and a PAT of Rs 287.86 crore in Q2-2014. For now the company has suspended manufacture of Maggi Noodles pending a decision of the Bombay High Court pertaining to a case it has filed regarding interpretation of the Foods Safety and Standards Act, 2011. The loss of the brand value, goodwill is difficult to calculate.

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

The company says that net sales worth Rs 288.38 crore has been reversed in the current quarter in relation to Maggi Noodles stock being withdrawn from trade partners and the market. The exceptional items amount of Rs 451.66 crore relates to estimates of loss on account of stocks withdrawn including incidental costs thereto and other costs incurred exclusively in the ordinary course of business, dealt with in with the Accounting Standard AS2 on valuation of inventories and Accounting Standard AS5 on net profit or loss for the period, prior period items and changes in accounting policies.

Let us look at the other numbers in Q2-2015 that have changed:

The company says that its net sales have been impacted by 20.1 per cent on account of Maggi Noodles. Nestle’s net domestic sales have decreased by 20.6 per cent , export sales decreased by 12.7 per cent impacted by lower coffee exports Russia, partly offset by export of milk and nutrition products to Bangla Desh. Nestle reported net Total Income from Operations (TIO) of Rs 1957.01 crore in the current quarter as compared to the Rs 2516.48 crore in the immediate trailing quarter and the Rs 2431.97 crore in the corresponding year ago quarter.

Total Expenditure (TE) in Q2-2015 declined to Rs 1634.38 crore as compared to the Rs 2000.75 crore in Q1-2015 and the Rs 2008.91 crore in Q2-2014. Nestle’s cost of materials consumed declined to Rs 718.80 crore in Q2-2015 as compared to the Rs 1110.50 crore in Q1-2015 and Rs 1123.47 crore in Q2-2014.

For the six month period ended 30 June, 2015 (6M-2015, YTD), Nestle reported a 5.9 per cent drop in TIO to Rs 4473.49 crore as compared to the Rs 4753.48 crore in 6M-2014. PAT in 6M-2015 declined to less than half (fell by 53.2 per cent) at Rs 255.88 crore as compared to the Rs 547.02 crore in the corresponding period of the previous year.

During 6M-2015, TE was lower at Rs 3635.13 crore as compared to the Rs 3913.13 crore in 6M-2014. The company’s cost of raw materials declined to Rs 1829.30 crore as compared to the Rs 2275.39 crore in 6M-2014.

Nestle’s board of directors at its meeting held on 29 July, 2015 based on the recommendation of the Nomination and Remuneration Committee, appointed Suresh Narayanan as managing director of the company effective from 1 August, 2015, subject to approvals. The company will seek consent of members by means of postal ballot on the proposal of the appointment of Narayanan as managing director. The board of directors has also appointed Abhinav Khosla, a chartered accountant, to act as the scrutinizer for conducting the postal ballot process in a fair and transparent manner.

July 30, 2015
Q1-2016: Dabur marketing spends up 15.5%

BENGALURU: Dabur India Limited (Dabur) spent 15.5 per cent more towards advertising and publicity expenses (ASP) in the quarter ended 30 June, 2015 (Q1-2016) at Rs 330.61 crore (16 per cent of Total Income from Operations or TIO) as compared to the Rs 286.27 crore (15.3 per cent of TIO) in Q1-2015 and 24.6 per cent more than the Rs 265.39 crore (13.6 per cent of TIO) in Q4-2015.

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

Dabur’s products

Among the products that Dabur has include health supplements like Chyawanprash, Ratnaprash, Honey, Glucose; digestives like Hamjola – Hajmola Chuzkara and Natkhat Amrud, Pudin hara fizz; OTC and Ethicals such as Lal Tail, Honitus Syrup; Haircare products like Vatika, Vatika Brave and Beautiful digital, Anmol Jasmine marks; Toothpaste brands like Dabur Red, Babool and Meswak; skincare products like Fem natural fairness, Gold Bleach, Gulabari; Homecare brands such as Odomos, Odonil and Sanifresh; Food brands such as Real and Real Active.

“The macro-economic scenario remains challenging. In this subdued environment, we remained watchful, agile and prudent, managing our business dynamically to deliver another quarter of competitive and profitable growth. Our India FMCG business ended the first quarter of 2015-16 with an 11.6 per cent growth, led by an 8.1 per cent volume growth. Our EBITDA marked a 21.6 per cent growth during the quarter,” said Dabur India CEO Sunil Duggal said.

“Going forward, we will focus on our cost efficiencies and pursue an aggressive and profitable growth strategy. We continue to strengthen our business for the long term by driving innovation and investing behind our brands. With these initiatives, we are confident of growing ahead of the market and improving our market share,” Duggal added.

Trends

The company’s ASP in Q1-2016 at Rs 330.61 crore (16 per cent of TIO) was the highest in terms of actual rupee spends as well as in terms of percentage of TIO during the 11 quarter period starting Q3-2013 until Q1-2016. Over the 11 quarter period under consideration, Dabur’s ASP in absolute rupees and ASP in terms of percentage of TIO both show a linear increasing trend. Please refer to Fig 1 below.

Fig 1 below indicates that ASP in terms of percentage of TIO follows a linearly increasing zigzag line, with peaks in Q1 and Q3 and valleys in Q2 and Q4 of a financial year. Based on this, it is quite likely that the company’s ASP in Q2-2016 (next quarter) may be lower in terms of percentage of TIO.

Dabur TIO in Q1-2016 at Rs 2069.49 crore was 10.6 per cent more than the Rs 1868.86 crore in Q1-2015 and was 6.1 per cent more than the Rs 1949.74 crore in Q4-2015. The company’s TIO shows a linear increasing trend during the eleven quarter period under consideration in this report.

Dabur PAT for Q1-2016 at Rs 262.10 crore (12.7 per cent of TIO) was 24.3 per cent more than the Rs 210.81 crore (11.3 per cent of TIO) in Q1-2015, but was eight per cent lower than the Rs 284.86 crore (14.6 per cent of TIO) in the immediate trailing quarter. PAT in abslute rupees as well as in terms of percentage of TIO show linear increasing trends. Please refer to Fig 2 below.

Category Growths

Dabur says that its Toothpaste business, led by strong demand for Dabur Red Paste and Dabur Meswak, ended the first quarter with a near 24 per cent growth. The OTC and Ethicals business ended the first quarter with a 16.7 per cent growth, while the Foods category reported a 15.5 per cent growth during Q1. While the Hair Oil category reported a 13 per cent growth during the period, the Shampoo business ended the quarter with an 11.5 per cent growth. The Home Care business grew by nearly 12 per cent during the period.

Click here to read unaudited results

July 29, 2015
Q1-2016: Just Dial revenue up 25%

BENGALURU: Indian search engine and directory services provider Just Dial Limited (Just Dial) reported a 24.9 per cent jump its total income from operations (TIO) in the quarter ended 30 June, 2015 (Q1-2016) to Rs 168.62 crore as compared to the Rs 135.03 crore in Q1-2015 and a 7.9 per cent increase from the Rs 156.28 crore in Q4-2015.

Let us look at the other numbers reported by Just Dial

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

The numbers in this report are unaudited and unconsolidated.

Just Dial’s PAT for Q4-2016 increased 18 per cent to Rs 33.17 crore (19.7 per cent of TIO) as compared to the Rs 28.11 crore (20.8 per cent of TIO) in the corresponding quarter of last year, but was 29.7 per cent lower than the Rs 47.16 crore (30.2 per cent of TIO in Q4-2015.

Simple EBIDTA in Q1-2016 at Rs 48.42 crore (14.3 per cent of TIO) was 42.4 per cent higher than the Rs 34 crore (25.2 per cent of TIO) in Q1-2015 and was 14.3 per cent more than the Rs 42.36 crore (27.1 per cent of TO) in the immediate trailing quarter.

The company’s Total Expenditure (TE) in Q1-2016 at Rs 126.93 crore (75.3 per cent of TIO) was 18.9 per cent more than the Rs 106.74 crore (79 per cent of TIO) in Q1-2015 and was 5.9 per cent more than the Rs 119.89 crore (76.7 per cent of TIO) in Q4-2015.

Employee Benefit Expense (EBE) is the major expense head for Just Dial. EBE in Q1-2016 at Rs 88.11 crore (52.3 per cent of TIO) was 30.9 per cent more than the Rs 6.732 crore (49.9 per cent of TIO) in Q1-2015 and 1.2 per cent more than the Rs 87.07 crore (55.7 per cent of TIO) in Q2-2015.

Just Dial reported depreciation and amortisation expense (Depreciation) of Rs 6.73 crore (four per cent of TIO) the current quarter, which was 17.9 per cent more than the Rs 5.71 crore (4.2 per cent of TIO) in Q1-2015 and was 12.7 per cent less than the Rs 5.97 crore (3.8 per cent of TIO) in Q4-2015.

July 28, 2015
Q1-2016: Dish TV q-o-q PAT up 55%, adds 390K net subscribers

BENGALURU: Last fiscal and quarter (year and quarter ended 31 March, 2015, Q4-2015), the Subhash Chandra led Essel groups DTH operator Dish TV Limited (Dish TV) turned the corner with a consolidated PAT of Rs 3.14 crore and Rs 34.94 crore (margin 4.8 per cent) respectively.

Dish TV was probably the first among listed DTH companies in the country in FY-2015 and Q4-2015 to report a profit after tax as opposed to the operating profits reported by a segment of the other goliaths for whom DTH services is just another small segment.

This quarter (quarter ended 30 June, 2015, Q1-2016), the company has reported 55.2 per cent higher PAT at Rs 54.21 (margin 7.4 per cent) as compared to the above mentioned PAT in Q4-2015. The company had reported a loss of Rs 14.97 crore in Q1-2015.

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

(2) With effect from April 1, 2015, Dish TV says that it has started netting-off certain collection fees paid to its trade partners from its topline. This has resulted in the company’s topline getting shrunk by around 4 percent, with a similar number being decreased from the middle line. The values for the prior comparative periods have also been recast to reflect the same.

(3) Dish TV recently transferred its non-core business (including set-top boxes, dish antenna and related services) to its wholly owned subsidiary Dish Infra Services Private Limited (formerly known as Xingmedia Distribution Private Limited) on April 1, 2015 on a going concern basis. The Company today reported its maiden consolidated quarterly numbers.

The company reported addition of 3,90,000 net subscribers in Q1-2016, taking its total subscriber base to 1.33 crore as on 30 June, 2015. Post consolidation, Dish TV says that Average Revenue Per User (ARPU) was Rs 173 versus Rs 172 (q-o-q) in Q4-2015. ARPU however would have been Rs 180, as compared to Rs 179 in Q4-2015, without the effect of consolidation. The company reported consolidated subscription revenues at Rs. 628.88 crore, up 20.6 percent y-o-y.

The company reported 0.9 per cent higher consolidated net total Income from Operations (TIO) in the current quarter at Rs 736.68 crore as compared to the Rs 729.93 crore in the immediate trailing quarter and was 19.2 per cent more than the Rs 618.04 crore in Q1-2015.

Dish TV chairman Subhash Chandra said, “Dish TV has been actively contributing to the ‘Digital India’ movement by digitizing analog TV homes in DAS phase 3 and 4 markets and remains optimistic about its prospects to acquire a substantial share in these markets. Continuing its focus on growth with profitability, the company delivered another quarter of encouraging financial results.”

Let us look at the other numbers reported by Dish TV

Dish TV total expenditure in Q1-2016 at Rs 659.69 crore (89.5 per cent of TIO) was 0.7 percent lower than the Rs 664.08 crore (91 per cent of TIO) in Q4-2015 and was 8.7 per cent more than the Rs 606.80 crore (98.2 per cent of TIO) in Q1-2015.

A major expense head is programming /content and other costs (content costs). In Q1-2016 content cost at Rs 212.01 crore (28.8 per cent of TIO) was 2.1 per cent more than the Rs 207.62 crore (28.4 per cent of TIO) and was 5.3 per cent more than the Rs 201.39 crore (32.6 per cent of TIO) in Q1-2015.

Employee Benefit Expense (EBE) in Q1-2016 at Rs 34.67 crore (4.7 per cent of TIO) was 39.7 per cent more than the Rs 24.81 crore (3.4 per cent of TIO) an was 34.8 per cent more than the Rs 25.72 crore (4.2 per cent of TIO) in the corresponding year ago quarter.

Dish TV managing director Jawahar Goel said, “Our first quarter results are in line with the success of our regional and high definition (HD) strategy. Our regional offering, Zing, would soon be launched in Kerala and would carry the largest cache of vernacular channels offered in that market. Zing cemented Dish TV’s supremacy in the DAS Phase 3 and 4 markets with custom-made content, hardware and service packages for the regional audience. High definition continues to be a value driver and a key differentiator for us compared to other DTH offerings in India. Dish TV’s industry leading bandwidth capacity supports 42 HD channels, the largest on offer by any distribution platform so far.”

“Led by robust subscriber additions and an improving ARPU, subscription revenues for the quarter increased 20.6 per cent over the corresponding quarter last fiscal. EBITDA of Rs 2,368 million recorded a significant 51.3 per cent jump over the corresponding quarter. Net Profit for the quarter was Rs 54.2 crore compared to a loss of Rs 15 crore in the first quarter last fiscal. The resultant free cash flow was Rs 68.9 crore. Amid improving financial performance, churn for the quarter remained steady at 0.7 per cent per month,” added Goel.

July 28, 2015
Q1-2016: Jagran Prakashan y-o-y revenue up 9.3%; Radio City op profit up 40%

BENGALURU: Indian publishing group Jagran Prakashan Limited (JPL) reported 9.3 per cent growth in consolidated operating revenue in the quarter ended 30 June, 2015 (Q1-2016) to Rs 481.15 crore as compared to the Rs 440.29 crore in Q1-2015. Q-o-Q, JPL’s revenue grew 13.8 per cent as compared to the Rs 422.74 crore in Q4-2015.

The company’s consolidated profit after tax (PAT) in the current quarter increased 18.5 per cent to Rs 66.36 crore as compared to the Rs 55.99 crore in Q1-2015. However, q-o-q PAT was 39.7 per cent lower than the Rs 129.67 crore in Q4-2015. Adjusted PAT after extraordinary items in Q1-2016 at Rs 179.94 crore was however higher than Q1-2015 and Q2-2015 PAT.

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

JPL’s radio subsidiary Music Broadcast Limited (MBL), which has 20 radio stations under the brand ‘Radio City’ reported 40 per cent higher operating profit at Rs 14.5 crore in Q1-2016 as compared to Rs 10.4 crore in the corresponding year ago quarter. The company reported a loss of Rs 2.2 crore in Q1-2016 on account of Rs 13.6 crore (exceptional items) incentives to the management team in respect of their past services in terms of agreement with the erstwhile promoters. If the exceptional items are not considered, then MBL’s PAT would be 74 per cent higher in Q1-2015 at Rs 11.3 crore as compared to the Rs 6.5 crore in the corresponding year ago quarter. In the immediate trailing quarter Radio City’s PAT was Rs 8.47 crore.

Advertising and Circulation numbers

Consolidated advertisement revenue was up by 11.9 per cent to Rs 345.54 crore in Q1-2016 as compared to the Rs 308.89 crore in Q1-2015, while standalone advertisement revenue up by 8.4 per cent to Rs 312.23 crore as compared to the Rs 288.01 crore in Q1-2015. Radio City reported advertising revenue of Rs 13.08 crore in Q1-2016.

Consolidated Circulation revenue in the current quarter increased 5.1 per cent to Rs 100.51 crore as compared to the Rs 95.66 crore in Q1-2015. Standalone circulation revenue increased 5.4 per cent to Rs 94.48 crore in Q1-2016 as compared to the Rs 89.64 crore in the corresponding year ago quarter.

Let us look at the other numbers reported by Jagran Prakashan

Total Expense in Q1-2015 at Rs 369.45 crore was 12.2 per cent more than the Rs 329.35 crore Q1-2015 and 6.6 per cent more than the Rs 346.61 crore in the immediate trailing quarter.

Cost of Raw materials consumed in Q1-2016 at Rs 155.89 crore was 4.2 per cent less than the Rs 162.7 crore in Q1-2015, but 8.3 per cent more than the Rs 346.61 crore in Q4-2015.

The company’s radio segment results have been mentioned above. The segment reported 10.3 per cent growth in operating revenue to Rs 47.4 crore as compared to the Rs 43 crore in Q1-2015. For Q4-2015, MBL reported revenue of Rs 53.93 crore.

MBL’s interest costs have been increasing with time. In Q1-2016, the company paid more than six times the interest it paid at Rs 5.10 crore as compared to the Rs 0.80 crore in Q1-2015 and 26.2 per cent more than the Rs 4.04 crore in Q4-2015.

Company speak

JPL chairman and managing director Mahendra Mohan Gupta said, “Q1-2016 was eventful for more than one reason. The company not only completed the long awaited acquisition of Radio City but it also delivered the highest ever profit and probably the highest growth in advertisement revenue in the industry. This robust performance in an economically difficult time could be possible due to the company’s ability to timely sense the inordinate delay in economic recovery and act accordingly.”

“From the first quarter itself, Radio City has started contributing to the company’s profits and I am confident that this acquisition is going to be hugely value accretive. Finally, even though the economy is not yet supporting the growth, the first quarter’s performance gives me the confidence that we will continue to grow and meet your expectations,” added Gupta.

July 28, 2015
Q2-2015: Forex pulls down Hasbro revenue; Licensing & Entertainment op income halves

BENGALURU: American multinational toy and board game company Hasbro, Inc., (Hasbro) reported 3.8 per cent decline in net revenue to $797.66 million in the quarter ended 28 June, 2015 (kQ2-2015) as compared to the $829.26 million in the corresponding year ago quarter (quarter ended 29 June, 2014) impacted by negative forex of $71.5 million says the company. If the forex loss was neglected, net revenue in Q2-2015 grew 4.8 per cent in the current quarter as compared to the previous quarter.

For the six month period ended 28 June, 2015 (6M-2015), Hasbro reported almost flat revenue(0.2 percent higher) at $1511.16 million as compared to the $1508.72 million in 6M-2014 (six months ended 29 June, 2014).

Hasbro’s Licensing and Entertainment segment contributes around six per cent to Hasbro’s revenue. The segment reported almost flat revenue in Q2-2015 $47.64 million as compared to the $47.66 million in the corresponding year ago quarter. However, its operating income halved (declined by 49 per cent) to $7.44 million in Q2-2015 as compared to the $14.65 million in Q2-2014, primarily due to digital gaming expenses, including the final quarter of amortization expense from certain digital gaming rights says the company.

Company speak

Net earnings attributable Hasbro increased 22.7 per cent to $41.81 million (5.2 per cent of net revenue) in Q1-2016 as compared to the $33.48 million (four per cent of net revenue in Q2-2014).

“Our second quarter results continue a strong start to the year with good underlying momentum in our Franchise and Partner brands across geographies,” said Hasbro chairman, president and CEO Brian Goldner. “The execution of our brand blueprint strategy, including our recent decision to sell our final manufacturing locations and the continued development of new relationships in content development, furthers the transformation of Hasbro into an organization focused on global brand building. We are well positioned for the remainder of 2015, but importantly we continue to develop our capabilities for the long-term execution of our strategy toward unlocking the full potential value of our brands.”

“Our second quarter results came with numerous challenges, including a significant negative foreign exchange impact and difficult year-over-year comparisons in several brands,” said Hasbro CFO Deborah Thomas. “Even with these challenges, we delivered a strong second quarter and a good first half of 2015. We continue to make important investments across our business to promote brand initiatives and to further improve the global efficiency of Hasbro. Some of these investments will be more prominent in the second half of 2015 than they were in the first six months of the year.”

Segment Revenue

Licensing and Entertainment segment

Hasbro’s Licensing and Entertainment segment numbers have been mentioned above.

US and Canada segment

Hasbro’s US and Canada segment net revenues increased one per cent to $385.2 million compared to $383 million in Q2-2014. The segment’s results reflect growth in the Boys and Preschool categories says Hasbro. The US and Canada segment reported operating profit of $47.1 million, essentially flat with $46.9 million in Q2-2014.

International segment

International Segment net revenues were $362.8 million compared to $396.8 million in 2014. Growth in the Preschool category was more than offset by declines in the Boys, Games and Girls categories. On a regional basis, growth in Latin America was offset by declines in Europe and Asia Pacific. Emerging markets revenues declined 11 per cent in the quarter. Excluding an unfavourable $69.5 million impact of foreign exchange, of which approximately two-thirds of the impact was in Europe and the remainder in Latin America, net revenues in the International Segment grew nine per cent and approximately nine per cent in emerging markets.

The International Segment reported operating profit of $25.4 million compared to the $29.2 million in 2014, which was also negatively impacted by foreign exchange.

Category Performance

Boys category

Q2- 2015 net revenues in the Boys category increased one per cent to $340.4 million. This growth was driven by year-over-year revenue gains in Hasbro franchise brand Nerf, as well as shipments in support of Jurassic World and growth in Marvel and Star Wars products. These increases more than offset the anticipated decline in Transformers, which faced difficult comparisons versus the 2014 shipments in support of the theatrical release of Transformers: Age of Extinction.

Games category

Games category revenues declined six per cent in the quarter to $211.6 million. Magic: The Gathering declined in the quarter as the major set release occurred in the first quarter 2015 versus the second quarter 2014.

Over the first six months of the year, Magic: The Gathering revenues increased. Additional revenue declines in Duel Masters and Angry Birds products were partially offset by gains in franchise brand Monopoly as well as in several other games brands including Trouble, Clue and Twister.

Girls category

The Girls category revenues declined 22 per cent in the second quarter 2015 to $127.5 million. Furby was the leading driver of this decline, along with smaller declines in Franchise Brands My Little Pony and Nerf Rebelle in the quarter. Growth in Play-Doh Dohvinci and shipments of Disney Descendants partially offset these declines.

Preschool category

Preschool category revenues increased 14 per cent in the second quarter 2015 to $118.1 million. Growth in Franchise Brand Playdoh and shipments of Jurassic World more than offset revenue declines in core Playskool products.

July 28, 2015
Q1-2016: Ortel PAT at Rs 2.44 crore; on track for 1 million RGUs target

BENGALURU: The Bibhu Prasad Rath led regional cable television and high speed broadband services provider Ortel Communication Limited (Ortel) reported profit after tax (PAT) of Rs 2.44 crore (six per cent margin) in the quarter ended 30 June, 2015 (Q1-2016) as compared to a loss of Rs 1.16 crore in the corresponding year ago quarter. However, the company’s Q1-2016 PAT was less than half (lower by 56.8 per cent) the PAT of Rs 5.65 crore (12.6 per cent margin) in the immediate trailing quarter.

Ortel reported 20.5 per cent growth in Total Income from Operations (TIO) at Rs 40.60 crore in Q1-2016 as compared to the Rs 33.69 crore in Q1-2015, but 9.6 per cent lower than the Rs 44.91 crore in Q5-2015.

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

The numbers mentioned in this report are standalone.

Subscription numbers and ARPU

The company reported a 2.1 per cent growth in cable revenue generating units (RGU) in Q1-2016 at 481,317 as compared to the 471,592 in the immediate trailing quarter. In Q1-2015, the company had 462,328 RGU, hence the number grew by 4.1 per cent in Q1-2016.

Ortel’s q-o-q digital cable RGUs grew six per cent to 1,13,653 in the current quarter from 1,07,175 in Q1-2015, while its analogue cable RGUs grew 0.9 per cent to 3,67,664 as compared to the 3,64,417 in the same period.

The company reported a slight drop in average revenue per user (ARPU) in cable subscription – ARPU for digital cable dropped by Re 1 to Rs 184 and for analogue cable also the ARPU dropped by Re 1 to Rs 144 in the current quarter as compared to the immediate trailing quarter.

Broadband RGUs in the current quarter grew 4.1 per cent to 60900 from 58519 in Q4-2015. Ortel announced the launch of up to 50 Mbps DOCSIS 3.0 Broadband Internet in Odisha. The company’s Broadband ARPU in the current quarter also declined by Re 1 to Rs 393 from Rs 394 in Q4-2015.

LCO Buyout

Ortel signed network buy out agreements with multiple LCOs during the quarter taking the total RGUs to 542,217. The company said that another 33,000 RGUs are in the pipeline and would be added to total RGUs in the forthcoming months.

Company speak

Ortel president and CEO Bibhu Prasad Rath said, “We have begun the year on a healthy note with 25 per cent increase in revenues and 44 per cent improvement in EBITDA during Q1-2016. EBITDA margins enhanced to 37 per cent from 32 per cent in Q1-2015 and profit after tax stood strong at Rs 2.4 crore compared to Rs 5.6 crore reported in full year FY-2015. Thus the trend remains encouraging. Overall growth was delivered on the back of steady contribution from cable TV and broadband segments supported by continued momentum in the infrastructure leasing segment. Significant growth in subscriber base, deeper penetration, enhanced product offerings and a strong team, should enable us to notably improve our performance going forward.

I am also pleased to share that over and above the 542,217 RGUs as on 30 June, 2015, we have signed buy out agreements with multiple LCOs with total estimated RGUs of 33,000, which would be integrated into Ortel’s last mile network going forward. So we remain on track and are confident of achieving our target of one million RGUs (10 lakh) by March 2017 backed by our LCO buy out strategy and focus on organic growth both in broadband and cable TV.”

Let us look at the other numbers reported by Ortel

Total Expenditure in Q1-2016 at Rs 34.42 crore (84.8 per cent of TIO) was 14.8 per cent more than the Rs 29.99 crore (89 per cent of TIO) in Q1-2015 and 4.1 per cent more than the Rs 33.08 crore (73.6 per cent of TIO).

Ortel paid Rs 8.91 crore (22 per cent of TIO) towards programming cost, which was 3.6 per cent more than the Rs 8.60 crore (18.9 per cent of TIO) in Q1-2015 and was 4.9 per cent more than the Rs 8.49 crore (18.9 per cent of TIO) in the immediate trailing quarter.

Bandwidth cost in Q1-2016 at Rs 1.78 crore (4.4 per cent of TIO) was 6.9 per cent more than the Rs 1.67 crore (4.9 per cent of TIO) in the corresponding year ago quarter and was 2.3 per cent more than the Rs 1.74 crore in Q4-2015.

Employee Benefit Expense (EBE) in Q1-2016 at Rs 4.89 crore (12 per cent of TIO) was 19.3 per cent more than the Rs 4.09 crore (9.8 per cent of TIO) in Q1-2015 and was 11.4 per cent more than Rs 4.39 crore (12.2 per cent of TIO) in the immediate trailing quarter.

Ortel has introduced free broadband option for all Ortel Cable TV subscribers in the states of Odisha, West Bengal and Chhattisgarh as a complimentary special value added service in order to target to deeper penetrate into markets by making internet affordable. The company says that its offer includes a free data limit every month for a year. The subscriber will be charged a nominal amount after exceeding the free data usage for the month.

Click here to read the unaudited financial statement

July 27, 2015
Q1-2016: Reliance Retail y-o-y revenue up 17.5%

BENGALURU: Reliance Industries Limited’s (RIL) organized retail segment – Reliance Retail is a tiny fraction of the revenue that India’s largest private corporate reports. However, this segment has been growing consistently, quarter on quarter.

In Q1-2016 (quarter ended 30 June, 2015), though RIL has reported a 23 per cent y-o-y consolidated revenue drop, Reliance Retail posted a 17.5 per cent revenue growth in the same period at Rs 4968 crore as compared to the Rs 3999 crore in Q1-2015. Reliance Retail’s Q1-2016 revenue however was 1.9 per cent lower than the Rs 4788 crore in the immediate trailing quarter.

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

The retail segment reported a profit before tax (PBIT) of Rs 111 crore (2.4 per cent EBIT margin) in the current quarter, 37 per cent more than the Rs 81 crore (2 per cent EBIT margin) and 6.7 per cent more than the Rs 104 crore (2.2 per cent EBIT margin) in Q4-2015.

Though RIL reported a drop in revenue to Rs 83,064 crore in Q1-2016 as compared to the Rs 1,07,905 crore in Q1-2015, it was 17.2 per cent more than the Rs 70,863 crore in Q4-2015. RIL also posted a record consolidated PBDIT of Rs 12,095 crore, up 9.8 per cent as compared Rs 11,016 crore to Q1-2015. Net Profit at Rs 6222 crore was 4.4 per cent more than the Rs 5957 crore in the corresponding year ago quarter, but declined 2.5 per cent as compared to the Rs 6381 crore in the immediate trailing quarter.

Company speak on organized retail segment

The company says that its Value Formats consolidated its leadership position further of being the largest grocery retailer in the country. The business expanded its network further with new store openings to strengthen its leadership position and optimise its operations. The formats launched several own brands products under various categories in the quarter.

Reliance Market continued additions to its store network, reaching out to more and more kiranas, traders and institutions as partners across the country. Contribution of Private Label Sales to overall sales increased to 10 per cent from eight per cent in the same period last year. Reliance Market now serves over 17 lakh registered members across 35 cities.

The digital sector maintained its growth momentum and operates 1,298 stores across the country.

Reliance Digital with its superior in-store experience and extensive product assortments continued to improve its proposition and delight customers. Digital Express Mini rapidly scaled up its operations during the quarter and surpassed the milestone of operating over 1,000 stores across the country in a short time since launch, a feat achieved by any retailer first time in the country.

The Fashion and Lifestyle sector delivered strong performance in the quarter by offering fashionable, high quality merchandise at great value. Reliance Trends operates a strong own brand portfolio comprising over 20 brands that contribute over 70 per cent of overall sales. During the period, the format has partnered with a globally renowned fashion house to augment its in-house product design capabilities. The association would help in bringing global fashion trends to the Indian market thereby bridging the gaps in the merchandise offerings.

Reliance Brands strengthened its presence through its partnerships during this period. During the period, Reliance Brands announced an exclusive partnership with Japanese retailer Muji, which sells a wide verity of household and consumer goods and 130 year old Dutch lingerie brand Hunkemöller.

The first BCBG MAX Azria store was launched in Delhi, marking the launch of international womenswear brand known for its contemporary fashion sensibilities in India.

As on 30 June, 2015, Reliance Retail operated 2,747 stores across 210 cities in India.

July 25, 2015
Q2-2015: Record box office boosts Imax y-o-y revenue 30%, income per share 79%

BENGALURU: Joint-venture revenue sharing arrangements played a leading role in the 79 per cent increase in income per share to $0.34 from $0.19 for the Toronto, Canada based, New York Stock Exchange traded entertainment, technology and distribution company Imax Corp for the quarter (Q2-2015) ended 30 June, 2015. For the six month (YTD, 6M-2015) period of the current year, joint-venture revenue arrangement sharing also played a lead in the 70 per cent increase in income per share to $0.34 from $0.20 in 6M-2014.

The company’s y-o-y revenue in the current quarter increased 29.8 per cent to $107.16 million as compared to the $79.145 million in Q2-2014. YTD, Imax revenue increased 33 per cent to $169.371 million from $127.342 million in 6M-2014.

Company speak

Revenue from sales and sales type leases was $18.7 million in the second quarter of 2015, compared to $14.5 million in the second quarter of 2014, primarily reflecting the installation of 15 full theatre systems (14 new, one used) under sales and sales type lease arrangements in the most recent second quarter, compared to the 11 sales type theatres the company installed in the prior year period. In addition, there were no upgrades in existing locations in the second quarter of 2015, compared to 4 xenon upgrades in the second quarter of 2014.

Revenue from joint revenue sharing arrangements was $31.6 million in the quarter, compared to $19.4 million in the prior year period. During the quarter, the company installed 20 new theatres under joint revenue sharing arrangements, compared to 19 in the same period in 2014. The company had 477 theatres operating under joint revenue sharing arrangements as of June 30, 2015, as compared to 408 joint venture theatres one year prior.

Production and Imax DMR (Digital ReMastering) revenues were $36.6 million in the second quarter of 2015, compared to $24 million in the second quarter of 2014. Gross box office from DMR titles was $343 million in the second quarter of 2014, compared to $216 million in the prior year period. The average global DMR box office per screen in the second quarter of 2014 was $414,600 compared to $299,800 in the prior year period.

”The second quarter of 2015 was one of the strongest in Imax’s history, delivering our highest revenue ever, growing adjusted EPS by 60per cent compared to the same period last year, record box office and quarterly per screen averages that we have not seen since Avatar in 2010,” said Imax CEO Richard L. Gelfond. ”We believe the strength of this quarter clearly demonstrates the impact that a strong slate of blockbuster films can have on Imax and the operating leverage that results.”

”Momentum also continued to build on the network side of our business with higher than expected installations and strong signings activity in the quarter,” continued Gelfond, who was in Vienna for the world premiere of Mission Impossible: Rogue Nation at the historic Vienna Opera House, which has been transformed into an Imax theatre for this event. ”Tonight’s M:I5 event is the continuation of the transformation of Imax’s brand from the smaller successes onto center stage. More agreements to use Imax cameras as well as Imax premieres such asFurious 7 and Jurassic World are a powerful marketer for our brand and also signal the increasingly important role Imax plays in the entertainment ecosystem.”

Let us look at the other numbers reported by Imax

Imax net income in Q2-2015 almost doubled (up 1.92 times) to $24.35 million as compared to the $13.307 million in the corresponding year ago quarter. Similarly, 6M-2015 net income almost doubled (went up 1.94 times) to $278.65 million as compared to the $143.58 million in 6M-2014.

Note: (1) The primary revenue sources for the Company can be categorized into two main groups: theatre systems and films. On the theatre systems side, the Company derives revenues from theatre exhibitors primarily through either a sale or sales-type lease arrangement or a joint revenue sharing arrangement. Theatre exhibitors also pay for associated maintenance and extended warranty services. Film revenue is derived primarily from film studios for the provision of film production and digital re-mastering services for exhibition on Imax theatre systems around the world. The Company derives other film revenues from the distribution of certain films and the provision of post-production services. The Company also derives a small portion of other revenues from the operation of its own theatres, the provision of aftermarket parts for its system components, and camera rentals

(2)The Company has seven reportable segments identified by category of product sold or service provided: Imax systems; theater system maintenance; joint revenue sharing arrangements; film production and Imax DMR; film distribution; film postproduction; and other. The Imax systems segment includes the design, manufacture, sale or lease of Imax theater projection system equipment.

The theater system maintenance segment includes the maintenance of Imax theater projection system equipment in the Imax theater network. The joint revenue sharing arrangements segment includes the provision of Imax theater projection system equipment to an exhibitor in exchange for a share of the boxoffice and concession revenues. The film production and Imax DMR segment includes the production of films and the performance of film remastering services. The film distribution segment includes the distribution of films for which the Company has distribution rights.

The film postproduction segment provides film postproduction and film print services. The other segment includes certain Imax theaters that the Company owns and operates, camera rentals and other miscellaneous items.

Imax Theater Systems

Imax Theater Systems revenue in Q2-2015 increased 37.1 per cent to $63.117 million as compared to the $46.032 million in Q2-2014. YTD, revenue increased 37.2 per cent to $99.949 million from $72.843 million in 6M-2014.

Gross margin from Imax Theater System increased 46.7 per cent in Q2-2015 to $40.695 million from $27.748 million in the corresponding year ago quarter. YTD, gross margin during the current six month period also increased by 46.7 per cent to $62.778 million as compared to the 42.805 million in 6M-2014.

Joint venture revenue sharing arrangement numbers

The Imax Theater System growth (as well as growth in Imax overall numbers) was led by a 63.2 per cent growth in the revenue from joint revenue sharing arrangements at $31.594 million in the current quarter, as compared to the $19.363 million in the corresponding year ago quarter.

Gross Margin reported by Imax joint revenue sharing arrangements increased 79.9 per cent in Q2-2015 to $24.069 million from $13.378 million in the corresponding year ago quarter. YTD, gross margin during the current six month period increased by 67.9 per cent to $34.686 million as compared to the 20.661 million in 6M-2014.

Imax systems numbers

Imax systems revenue in Q2-2015 increased 24.3 per cent to $22.365 million as compared to the $17.996 million in Q2-2014. YTD, revenue increased 33.9 per cent to $34.479 million from $25.8756 million in 6M-2014.

Gross margin from Imax systems increased 16.8 per cent in Q2-2015 to $13.537 million from $11.589 million in the corresponding year ago quarter. YTD, gross margin during 6M-2015 increased by 32.8 per cent to $21.722 million as compared to the 16.362 million in 6M-2014.

Theater system maintenance numbers

Theater system maintenance revenue in Q2-2015 increased 5.6 per cent to $9.158 million as compared to the $8.673 million in Q2-2014. YTD, revenue increased 6.8 per cent to $18.008 million from $16.868 million in 6M-2014.

Gross margin from Theater system maintenance increased 11.1 per cent in Q2-2015 to $3.089 million from $2.781 million in the corresponding year ago quarter. YTD, gross margin during 6M-2015 increased by 10.2 per cent to $6.370 million as compared to the 5.782 million in 6M-2014.

Films

Films revenue increased 34 per cent in the current quarter to $36.369 million as compared to the $29.383 million in Q2-2014. For 6M-2015, revenue improved 24.5 per cent to $61.323 million as compared to the $49.257 million in the corresponding year ago six month period.

Gross margin from Films improved 46.2 per cent in Q2-2015 to $28.454 million from $19.592 million in Q2-2014. For the six month period ended 30 June, 2015, Films gross margin increased 35.1 per cent to $42.392 million as compared to the $31.381 million in 6M-2014.

Production and Imax DMR numbers

Production and Imax DMR was the only segment in ‘Films’ to attain revenue and gross margin q-o-q and YTD growth. Revenue in Q2-2015 grew 52.2 per cent to $36.603 million as compared to the $24.050 million in the corresponding year ago quarter. During 6M-2015, revenue grew 38.3 per cent to $54.279 million from $39.235 million in 6M-2014.

Production and Imax DMR gross margin in the current quarter grew 52.9 per cent in Q2-2015 to $28.488 million as compared to the $18.634 million in Q2-2014. YTD, gross margin grew 40.4 per cent to $41.713 million from $29.708 million in 6M-2014.

Distribution numbers

Distribution revenue in Q2-2015 declined 60.6 per cent to $1.158 million as compared to the $2,942 million in Q2-2014. For 6M-2015, distribution revenue declined 42.2 per cent to $2.546 million in 6M-2015 as compared to the $4.405 million in 6M-2014.

Distribution reported negative gross margin Q2-2015 at $0.351 million as compared to the $0.594 million in Q2-2014. For the six month period ended 30 June, 2015, Distribution gross margin was negative $0.216 million (loss) as compared to the $0.784 million in 6M-2014.

Post Production numbers

Post Production revenue in Q2-2015 declined 32.7 per cent to $1.608 million as compared to the $2.391 million in Q2-2014. For 6M-2015, revenue declined 19.9 per cent to $4.498 million as compared to the $5.617 million in 6M-2014.

Post Production gross margin in the current quarter declined 12.9 per cent in Q2-2015 to $3.17 million as compared to the $364 million in Q2-2014. YTD, gross margin grew 0.7 per cent to $0.895 million from $0.889 million in 6M-2014.

‘Other’ numbers

Revenue from ‘Other’ in Q2-2015 grew 25.3 per cent to $4.674 million as compared to the $3.73 million in Q2-2014. 6M-2015 revenue grew 54.5 per cent to $8.099 million as compared to the $5.242 million in 6M-2014.

The ‘Other’ segment reported a negative gross margin in Q2-2015 of $0.114. For 6M-2015, gross margin was negative $0.154 million as compared to the $0.016 million in 6M-2014.

July 25, 2015