This is Aaditya Mulani from the HT Media Group. I would like to welcome you all to our quarter one financial year 2024-2025 earnings webinar. As a reminder, all participants will be in listen-only mode. After we are through with the presentation, there will be an opportunity for you to ask questions. I now hand over to Ms. Anna Abraham, CFO, Hindustan Media Ventures Limited, and Head Investor Relations, HT Media Group. Thank you, and over to you, Anna.
Thank you, Aaditya. Good afternoon, everyone. Thank you for joining the earnings webinar on the first quarter results of the company. Joining me for the call today is Mr. Piyush Gupta, Group CFO, Mr. Pervez Bajan, Group Controller, and the investor relations team. The results of Hindustan Media Ventures Limited was announced yesterday, July 25th, and those of HT Media Limited was released earlier today. We will, during the course of this webinar, discuss these results. Our comments during this webinar will follow the presentation slides. These slides and the financial statements are accessible on the Stock Exchanges and on the investor relations page of our websites. Before we proceed, I would like to bring to your attention the disclaimer related to forward-looking statements. Kindly keep this in mind as we move during the course of the call.
In line with our usual practice, we do not issue specific guidance on revenue or earnings. The current slide gives our Chairperson's comments on the performance of the company for the quarter, and I quote, Overall revenue saw a decline as compared to the same period last year, as national elections and the enforcement of the Model Code of Conduct impacted government advertising volumes in the quarter. Our focused efforts on cost management and operational efficiency helped mitigate the impact on profitability. Print advertising and circulation revenue saw a measured decline, affecting profitability. Radio posted growth in revenue over a year ago, but reported marginal losses, and the digital business, however, saw considerable upside in revenue on a YoY as well as QoQ basis, and better sequential profitability, albeit with ongoing investments in OTTplay.
The Company's focus remains on improving profitability in core businesses by driving top-line growth as well as on growing new digital businesses, aided by measured investments in the medium term. At this juncture, our strong market presence across media platforms and robust liquidity position remain a source of strength and competitive advantage in the dynamic media landscape. Now more than ever, we remain committed to serving all our customers and stakeholders with integrity and transparency. Your continued support and trust are integral to our success. Our unwavering focus remains on providing credible and insightful news and engaging entertainment . The agenda today will cover the financial performance of the quarter, focusing on the consolidated financials and thereafter the business-wise results. After the presentation, we will open for a Q&A session. With this, now I hand over the call to Mr. Piyush Gupta.
Thank you, Anna. Good afternoon, friends. We will be tracking the presentation here. First, we will look at the consolidated financial summary. As you can see on your chart, overall revenue decline impacted profitability for the reported quarter. Company continues to maintain a robust cash position. If you look at the number versus the same period last year, revenue is down by 4% at INR 427 crores. EBITDA is at INR 7 crores with a margin of 2%. PBT came at a -INR 36 crores, and net cash still remains robust at INR 858 crores. Moving on. Now we look at the business unit performance. Coming into print. Print segment operating revenue for the quarter, as both advertising and circulation revenue saw a decline. Operating profitability is near breakeven, with benefit and use print cost offsetting impact of a drop in revenue.
If you look at the numbers on the print, the revenues are down 10%, which, as my colleague pointed out, was primarily the impact of the Model Code of Conduct in the first quarter. Circulation revenues were down marginally at INR 55 crores, hence operating revenues at about INR 299 crores with a breakeven margin. A quick look at English. We saw government-led revenues decline in this quarter, with key commercial sectors seeing a YoY growth and drop in circulation revenues on back of the lower copies. So on advertising revenue, it came at INR 117 crores versus INR 130 crores same period last year, which is a 10% decline. Versus the sequential quarter, that is a sharpish drop of 26%, because in the previous quarter, there was a run-up in the election, whereas the Model Code of Conduct impacted the current quarter.
On the right side of the chart, if you look at the circulation revenue, which came virtually flat at about INR 50 crores growth. On a sequential basis, they were flat again at about INR 51 crores. Moving on to Hindi. The government-led revenue declined this quarter, whereas on a sequential basis, the sector seeing a YoY growth from the commercial side. Circulation revenue dropped YoY, remained flat sequentially. If we look at the numbers, there is an 11% decline in the first quarter at INR 102 crores on advertising revenue, whereas versus the immediately preceding quarter, that is a 24% decline. On the circulation revenue, it is a 10% decline and a flat number on a sequential basis. Moving on to radio. For the reported quarter, there is a marginal YoY growth in operating revenue, with operating EBITDA breakeven.
If you look at the numbers, it is virtually flat at INR 36 crores with a breakeven EBITDA. Moving on. On the digital side, digital revenue increased on an annual as well as a sequential basis, owing to the top-line improvement in key businesses. Continuing loss on account of OTTplay, however, losses are lower than the sequential quarter. If you look at the numbers, operating revenue came at INR 47 crores, which is 31% jump with the operating EBITDA at a -INR 55 crores. With this, we come to the end of the presentation, and we would go for the questions and answers.
Thank you, Piyush. With this, we will now begin the Q&A session. You can click on the Raise Hand option, which will enable the moderator to unmute you for posing your query. Please introduce yourself before posing your query and kindly restrict to a maximum of two questions per participant so that we may be able to address questions from all participants. We will wait for a few moments while the question queue assembles. First question is from the line of Mehul Pathak. Please introduce yourself and ask your question. Mr. Mehul, you will have to unmute yourself.
Yeah. Can you hear me, sir?
Yeah. Good afternoon, Mehul. We can.
Yeah. Hello, Piyush and Anna. Hope you are doing well.
Doing very well, Mehul. Hope you are doing well as well.
Yes. Till you declared the results today.
Okay.
I have two questions. First one is related to both HT Media and Hindustan. D.B. Corp has come up with their results and declared a profit, which is higher by 49%. Their top line is up close to 7%, 8%. There is an increase in advertisement revenue for them. Jagran Prakashan Limited and others have not come up with their results. Also, if you see, Jagran Prakashan Limited has returned INR 1,660 crore to their shareholders in the last four years. We are not in a sector where the sector is in distress. In 2018, our net worth was INR 2,550 crore. With today's results, it should have come down to below INR 1,650 crore. So INR 900 crore already lost. We are on our way. Maybe in 10 years, net worth will get wiped out at this rate.
Internally, is there any thought on when you will call a mayday?
Well, I wouldn't exactly
Mutual funds have already shipped out long time ago. Many of us diehard shareholders of HT Media are hanging on. I just wanted to know, when will you call a mayday? When the net worth becomes INR 500 crore, INR 800 crore?
Yeah. Well, Mehul, I wouldn't exactly characterize like that. I think the big difference between D.B. Corp, whose results are out, you're absolutely right. I mean, stellar set of numbers. I think you've been attending our call, and you've been engaged with the company for a very long time. You absolutely understand that the company is creating businesses which will create a sustainable long-term value. Now, I'm talking at a group level, also HMVL, because you touched upon D.B. Corp Ltd. Most of the investments which are now going ahead are going on OTTplay, and that we've explained in multiple number of calls. Now, that business, as I explained in the digital segment, of course, the numbers are very small, but it has shown some early proof of life. As a concept, we've basically explained the concept.
If that concept clicks, given the pilferage of OTTs and given that they have now totally got accustomed to all the household, this will be a unique proposition, which also we will have an early mover's advantage. Most of our efforts are going to creating that business. Returning the money versus creating the business which can create sustainable long-term advantage for the shareholder is what we've been trying. On the print business, of course, D.B. Corp operates primarily in the market, whereby it has either a monopoly or duopoly position. The markets are quite rich from that perspective. We, of course, are in a highly competitive market, and we are doing to the best of our ability. But I would call it a situation where we need to call mayday. The balance sheet is adequately capitalized.
The company is ambitious in a sense that it is trying to create businesses for tomorrow. Only time will tell, but we are definitely hopeful if we are putting the money behind those businesses, that these businesses will create value for all shareholders, majority and minority.
Yeah, if I may add, the net worth still remains around INR 2,000 crores at a consolidated level. While the quarter one results are not out, we have the full year results of last financial year, and which shows that within our direct competitive markets, we have done as well as the other player. Yes, D.B. Corp has done substantially well, but in a different market. I think, once the results of the quarter 1 are also out, we will see. It is not like we have been continuously underperforming in our markets. We have been performing in our markets. The results have been good. The positive news in this quarter is also that the commercial categories have all grown. We have been able to improve our pricing also.
While government volumes were not there for certain reasons, and not fully compensated by political party revenue, the fact that commercial has fired and the pricing has moved will hold us in better stead. From a core business proposition point of view, there is nothing which is so drastic which has happened which requires a medium.
But if you keep losing INR 150 crores every year, INR 100 crores or INR 250 crores, it will one day show up. Mutual funds are not there. No new people are coming into the stock. The writing is on the wall. If current state of affairs continue, the writing is there on the wall.
Well, Mehul, I totally take your point. But nothing herein shows that we will keep on losing INR 150 crores. I don't think you should take that assumption, though we don't give forward guidance, et cetera. But I am very hopeful, given now how the print business, and I am now talking about only the core business, how that is poised. We will definitely not lose money this year. I mean, at a cash level, I am talking.
Okay. My next question is on Digicontent.
Yeah.
Is it okay to ask the question in this forum or
Not exactly. This is not a Digicontent call, Mehul. We can offline discuss that.
No, because Digicontent, the company secretary does not respond to emails. The shares were not trading for a long time. We were placed on dynamic surveillance, and I asked a few questions. I also sought a call and nobody responded. I even copied HT Media Investor email ID, and I did not hear back from Anna also.
Okay, fair enough. Mehul, why don't we just resend that same mail to HT Media Investor ID? We will ensure that you get a response.
Okay. Because see, Piyush, when I look at HT Media, Digicontent, et cetera, my question is, in terms of behavior of the management, a lot of things are not looking nice. For example, at Digicontent, the quarterly result, the board meets only for 25 minutes. Here is a company that has not shared a rupee with the shareholders. Almost the same board people are there in both the companies. Now, it is controlled at the family level. 25 minutes, you have not given a rupee to the shareholders all these years, and you finish a board meeting in 25 minutes? What are you reviewing? What exactly are you reviewing? I don't know. I just thought I should share my sentiment, in terms of observation, what is visible.
Well, fair enough. Let me answer that one by one. At Digicontent level, there is still a big loan which is outstanding. That loan, of course, part of it has been paid back, but the entire loan still has not been paid back. So that pretty much is on returning the money to the shareholders. In terms of the board meeting, I don't know why you said 25 minutes. This is a UFR for the first quarter. Between the audit committee and the board meeting, I think it takes easily about an hour and a half. But, I don't think time is a variable which decides, and there are no common shareholders. There is, of course, one common shareholder. At the family level, of course, the shareholders are the common. But in terms of independent directors, there's a brand-new set of independent directors in Digicontent.
It's not like it has common shareholders and they don't review anything. Everything is reviewed and the board meeting, including the audit committee, lasts for definitely more than one hour, even in the quarterly results. Forget about the annual results, which is much longer.
Coming to the surveillance measure, Mehul, that is not a measure that has anything to do with the company. It is at the Stock Exchange's prerogative to put these measures on. As a follow-up to your mail, we had checked with the company secretary, and we were advised that it has been already conveyed to you about the same. That is-
But correct me if I'm not wrong, Mehul, has the Digicontent stock, which I saw about two days ago, I haven't seen it today, hasn't that gone up by about 50% in the last two months?
No, it has gone up, maybe. But with respect to the surveillance, Anna, I had asked questions. Firstly, why are we in dynamic surveillance?
We cannot comment on it, Mehul. That is something which you will have to ask the Stock Exchanges. They do not disclose. They do not disclose either to us or to anybody, so it is a Stock Exchange's prerogative to put certain stocks on a surveillance.
No, but is not the management concerned that you have been put on dynamic surveillance? You would have your hypothetical reasons to address them also, is not it? I want to know what the management-
Mehul, the first time these ASM and GSM measures were done, which was about a year ago, and when we checked with the Stock Exchange, and my understanding, you can correct me if I am wrong because you are a market participant, I was given to understand it has nothing to do with what the company is doing. But at any given point in time, more than 800 to 900 companies are on ASM, GSM. So it is not like the moment you come on ASM, GSM, that is a branding thrown on your balance sheet.
Yes, but if I am the promoter of the company and I care for my shareholders, will I not be losing night sleep that the share is not trading?
Right now, at-
Will I not communicate something? There is no communication at all.
Mehul, we can discuss this offline, but at this point in time, I don't agree with you on the stock because I'm feeling very well for the shareholders that the stock price indeed has moved over the last two months the way it has moved.
The volumes are very thin. It's okay.
I know. But that is the liquidity in that company.
Okay. Thank you very much. All the best.
Thank you.
All the best for the coming quarters and hope to see things looking up, or at least please sell some non-core assets. That is my-
With your wishes. We will do our best.
promise to the board.
Thanks for your wishes, Mehul. We will do the best we can.
Thank you. The next question is from the line of Mehul Parikh. Please introduce yourself and ask your question.
Hello? Hello.
Yes.
Yeah. Can you hear me?
Yes.
Yes, please go ahead.
Yeah. Good evening, Piyush and Anna. I have one question. I had asked this and you had clarified it, but I am just seeking more clarification, that if I have taken a one-year subscription of, say, INR 1,000 on OTTplay, would that reflect as INR 250 in the current quarter, or would it reflect as full INR 1,000 in the current quarter?
250.
250.
That means this INR 9 crore revenue that we have reported on OTTplay, in HMVL, that is a quarter of the annual subscription, right?
Yes.
That is the quarterly pro-rata component of the annual subscription.
Perfect. Perfect. Thank you very much. That is it.
Thank you.
Just, however, to clarify, it is not just that we have annual subscriptions. We have various periodic subscriptions as well. Yeah, but-
Yeah, that is what I understand. Yeah, the principle remains the same. Yeah, okay.
Thank you. The next question is from the line of Hari S. Please introduce yourself and ask your question. Mr. Hari, you will have to unmute yourself.
Yeah. Am I audible, sir?
Yes, please go ahead, Hari.
Yeah. Two questions, sir. I recollect one of the earlier conference calls a couple of years back, we had a discussion on this ad revenue, and that time it was like for election. Because of elections, our ad revenue has increased, actually.
Yes.
And we discussed that elections are a one-off event, that they may not happen regularly. But now
Yes
the company is saying because of the elections, our ad revenues have gone down.
Yes. So Hari S, that's a very dynamic situation. Let me explain that a little bit more in detail. So two things happen whenever the union elections or the state in which the publication is present happens. When the elections are announced in that state, there are two trends which happen. There is one called government revenue, which obviously once the Model Code of Conduct comes into play, that stops. Now, this is what we call the DAVP revenue, which is basically the government's releases which come in the publication. However, the trend that you're referring to is the political revenue or the party-related revenue which comes. Now, what you're talking about, in that particular year, we got a lot of political revenue.
But unfortunately, in this year the government revenue, of course, stopped after the Election Commission of India imposed the Model Code of Conduct, but the political revenue didn't come. So what happens in such a situation is the government revenue, of course, went down, which had to go down, but the political revenue, which more than overcompensated that in that particular year, did not come. So hence, the elections this time were actually a net negative rather than being a net positive.
Also, to add, actually, as Piyush said, some of the benefits of the election which we generally see, actually predates the election. So quarter FOUR saw a lot of benefit from the election revenue because as a run-up to the election, there was a lot of heightened spends, which then, of course, with Model Code of Conduct, dries up. So in this instance, because the elections happened in the beginning of the quarter, most of the benefit towards the run-up of the election happened in the previous quarter.
That's the dynamic, Hari. I hope we've been able to answer your question.
Okay. The other thing is regarding ad revenue, can't we get down of this scale and increase the ad revenue share tremendously to get out of this loop of low revenues into operating losses and all? Can't the company try aggressively by disproportionately growing ad revenue, sir?
No, that's absolutely the plan, Hari, and I think my colleague did allude towards that. So there are two levers. Of course, there is a volume of advertising that comes in the publication, and then there is the ad pricing. At this point in time, we are working very aggressively to work on the ad pricing. Although the volumes are already back, but the pricing is something which is under pressure. So we are working very aggressively, trying to take up the ad pricing. As you can understand, pricing by nature comes to the bottom line, and we have seen some early success in the first quarter, and that's the point when Anna said that the commercial speed has worked up, but the government revenue is the part which has eluded us in this particular quarter.
If our pricing sticks and the program goes as per plan, you will see ad revenue performing better and better in the second quarter and the third quarter because that is a plan which is already under motion.
Okay. Thank you. And the final question, sir, regarding this OTTplay, can we out-license to other companies in other countries? Is there any option of that? Is this an exclusively new product or it is available all over the world, sir?
No. The current content rights do not allow us to take it beyond the country's border. This is a pan-India product at this point in time, and we cannot air this content outside the Republic of India.
Oh, the technology behind it, we cannot out-license it, sir?
No, we can do the technology, but the content which is running on the technology is licensed for India.
Okay.
Technology can be, but the content can't be.
Okay. Fine, sir. That answers. Thank you very much.
Thank you.
Thank you. The next question is from the line of Kavish Parekh. Please introduce yourself and ask your question.
Hi, sir. Thanks for the opportunity. This is Kavish Parekh from B&K. Sir, two questions. Firstly, on the core print business, how is the newsprint trajectory looking at this point? So what was the average newsprint cost this quarter, and how do we expect it to pan out over the coming quarters? Secondly, on the advertising revenue, what has really kept the ad revenue pie under pressure? As discussed earlier, our competitor has reported a high single-digit growth, led by a mix of high volumes as well as higher value. I understand that markets are different, but what will help us record growth here? Are we in a position to improve yields?
Yeah. Kavish, let me just give a highlight and then I'll pass it on to Anna. Look, on the competitor question, let me just paint a picture for you. In both the states where our competitor has a pole position, they're part of a duopoly. Whereas our Hindi publication has a pole position in Bihar, but is in the first three as far as the U.P. and Uttarakhand markets are concerned. As far as English is concerned, we are definitely a duopoly in Delhi and working, and let's call a competitor in Maharashtra, in the city of Bombay. That competitive position has a huge bearing on pricing, which brings me to the second part, which I was just explaining to the earlier participant. Pricing is something that as a program, we are working very aggressively and we've seen some early results in the first quarter.
The volumes are back, the pricing is under pressure. That's what we are working on. If that pricing piece sticks, you will see better revenue performance. As far as this quarter is concerned, if you just equate the government revenues, which obviously came down by about 25%-30% because of the Model Code of Conduct, you can see that the revenue will already be up. That's a high-level picture. I'll just pass it on to Anna.
Yeah. In the relevant markets for us, we have seen industry volumes come down by 12%. In the markets that we are in, both English and Hindi, the market volumes have also come down 8%, largely all led by the government piece. Commercial is holding. Therefore, as Piyush Gupta was mentioning, the market also matters. In the markets we are, the industry volume is also down. That is there. That is to kind of add to that point. On newsprint, we are at about, on a consolidated basis, at about 48,000. We are seeing some pressures on pricing, given all the disruptions in the market from a global supply chain logistics perspective. However, Q2 also, we expect to be at this level with slightly probably marginal increase because we have visibility to that.
But right now, we are not seeing the newsprint prices easing. It will probably increase a little bit till the situation is settled. But next quarter, we are not expecting a major shift from that levels.
Right. Thanks for that. Just as a follow-up, what is the contribution for government ads for us, both in election periods or say FY 2024 versus 1Q FY 2025?
About 20%- 25% is broadly the government contribution to.
But in the fourth quarter, to your point, that was much higher. But I am talking about both the government ad and the political ad put together. Because fourth quarter was a run-up to the elections and the first quarter is when the Model Code of Conduct came in. So it will be slightly higher in the fourth quarter and slightly lower in the first quarter.
Right. Got it. And on the newsprint, the follow-up is that, what level of inventory do we hold? Is it for a period of, say, three to four months?
Yeah, something like that.
All right. Thank you for that. That was it from my side. Thanks.
Thank you.
Thank you. The next question is from the line of Ketan Athavale. Please introduce yourself and ask your question.
Hello, sir. I am Ketan Athavale from Robo Capital. Sir, I wanted to know, by when can we break even in the digital business?
Digital business is largely, the losses are only pertaining to OTTplay. The rest of the businesses are mostly at breakeven or are marginally profitable. OTTplay, this is only the second year of the business in its current state of business operations. Therefore, a little too early to get profitability. Having said that, we have said that as revenues scale up and our scale builds, the losses will significantly reduce for this year as compared to last year. But we will not be looking at profitability at least this year for sure.
Okay. Do we have any updates on notice guidelines for radio?
Not at this point of time. We are-
Well, I think that is an industry issue, and we have been, along with the industry, making representations to the ministry. We are hoping that they will be notified pretty soon. But as they say, it is not done till it is done. We are all waiting for that at our industry level. Once that happens, that will be hugely beneficial to the company.
Okay, thank you.
Thank you.
Thank you.
Yeah.
Thank you, all. With this, we come to the end of the Q&A session. If you have any further queries, please reach out to the Investor Relations team. Your contact details are given in the investor presentation and are also mentioned on our websites. I now hand over to Piyush for closing remarks.
Thank you, dear friends, for joining Q1 FY 2025 call. We really hope to bring out a better set of numbers as we go forward. I have given you and explained the reasons, which is primarily the government revenue or the absence of that in this quarter. I wish you all the very best and a happy weekend, and we will look forward to talking to you, addressing you in the next quarter. Thank you.