On Q-o-Q basis, for the quarter ended June 2012, operating revenues de-grew 1% at Rs 519.96 crore. It added 5.04 lakh subscribers taking the subscriber base at 13.4 million (gross) and 9.8 million (net). ARPU increased from Rs 151 to Rs 156 due to price hike taken previously. Subscriber acquisition cost (SAC) increased to Rs 2145 from Rs 2127. OPM inclined by 244 bps at 29.9% due to fall in other operating cost, selling & distribution cost and other expenditure. The net loss stood at Rs 32.32 crore, down 34%..
On Y-o-Y basis, for the quarter ended June 2012, operating revenues grew 12% at Rs 519.96 crore The subscription revenues had increased by 16% to Rs 455.6 crore. Other operating revenues includes lease rent of Rs 46 crore, bandwidth revenues of Rs 8 crore, teleport income of Rs 5 crore and other income including ad income of Rs 4.5 crore. OPM inclined by 350bps at 29.9% due to fall in programming & content cost along with selling & distribution cost. The net loss stood at Rs 32.32 crore, which was up by 76%. The net loss was negatively impacted by foreign exchange loss of Rs 13.8 crore.
Standalone Performance
Quarterly Performance (Sequential)
For the quarter ended June 2012, operating revenues de-grew 1% at Rs 519.96 crore. It added 5.04 lakh subscribers taking the subscriber base at 13.4 million (gross) and 9.8 million (net). ARPU increased from Rs 151 to Rs 156 due to price hike taken previously. Subscriber acquisition cost (SAC) increased to Rs 2145 from Rs 2127.
OPM inclined by 244 bps at 29.9% due to fall in other operating cost, selling & distribution cost and other expenditure. The operating profit was up by 8% to Rs 155.59 crore. As a % of adjusted sales, other operating cost decreased by 180 bps to 9.9%, selling and distribution cost decreased by 130 bps to 12.5% along with other expenditure by 70bps at 4.1%.
Other income was up by 12% to Rs 10.57 crore. Interest cost was up 36% at Rs 47.28 crore while depreciation & amortization charge decreased by 10% at Rs 151.2 crore. The net loss stood at Rs 32.32 crore, down by 34%..
Quarterly Performance (y-o-y)
For the quarter ended June 2012, operating revenues grew 12% at Rs 519.96 crore . It added 5.04 lakh subscribers taking the subscriber base at 13.4 million (gross) and 9.8 million (net). The subscription revenues had increased by 16% to Rs 455.6 crore. Other operating revenues includes lease rent of Rs 46 crore, bandwidth revenues of Rs 8 crore, teleport income of Rs 5 crore and other inclome including ad income of Rs 4.5 crore.
OPM inclined by 350bps at 29.9% due to fall in programming & content cost along with selling & distribution cost. The operating profit was up by 27% to Rs 155.59 crore. As a % of adjusted sales, selling and distribution cost decreased by 50 bps to 12.5% while programming & other costs decreased by 490 bps at 29%.
Other income was down by 23% to Rs 10.57 crore. Interest cost was up by 42% at Rs 47.28 crore while depreciation & amortization charge increased 25% at Rs 151.2 crore. The net loss stood at Rs 32.32 crore, which was up by 76%. The net loss was negatively impacted by foreign exchange loss of Rs 13.8 crore.
FY12 Performance
The operating revenues grew 36% at Rs 1957.82 crore. OPM improved 883 bps at 25.5%. The operating profit was up by 109% to Rs 498.36 crore. As a % of adjusted sales, programming & other costs decreased by 490 bps to 31.1% along with selling and distribution cost by 500 bps to 14.8%
Other income was down by 56% to Rs 38.59 crore. Interest cost was up 18% at Rs 177.8 crore. Iterest coasyt also includes Rs 2.16 crore relating to interest on tax litigations pertaining to earlier years. Depreciation & amortization charge increased 42% at Rs 518 crore. The resultant loss at PBT and PAT level decreased 16% at Rs 158.85 crore. The net loss was negatively impacted by foreign exchange loss of Rs 51 crore
Other developments
The recently launched 'Dish truHD+,' a High Definition (HD) box capable of digital recording, remains a key driver of HD subscribers on the platform. Dish TV garnered a 25% incremental share of HD additions during the quarter.
The life of the Consumer Premises Equipment (CPE) for the purposes of depreciation has been estimated by the management as five years, uptil 31st March 2012. However, in certain cases, the one-time advance contribution towards the CPE in the form of rental is recognized over a period of three years. Such practices during the current quarter has changed to 5 years. There is no significant impact on the financial results.
Dish TV Lanka (Private) Limited, a Joint Venture Company, was incorporated on April 25, 2012 under the laws of Sri Lanka. Dish TV India Ltd holds 70% share capital in the JV company with Satnet (Private) Limited, a company duly incorporated in and having a DTH License in Sri Lanka, holding 30% of the share capital. The said JV company shall engage in providing DTH related services in Sri Lanka
The Company had received a demand notice for income-tax and interest thereon aggregating Rs 26.42 crore in relation to an earlier year. The matter pertains to alleged short deduction of tax at source on certain payments and interest thereon for delayed period. The Company has disputed the issue and has filed an appeal against the above said demand with the tax authorities. The Company, supported by a legal view in the matter, is of the view that outcome of the litigation will not have any significant impact on the financial results. During the perious year, this matter was qualified in the statutory auditor's report.
The Company's net-worth as at the end of the financial year is completely eroded by its accumulated losses. However, the management has prepared the financial results assuming that the Company will continue as going concern considering that the Company has adequate resources in the form of operating cash flows and sanctioned credit facilities from lenders to adequately meet its obligations
Management Comments:
Mr Subhash Chandra, Chairman, stated,
The television distribution industry is on the threshold of a sea change in the way it has operated all these years. Mandatory digitization, though deferred by four months, raises the bar for quality television viewing while promising to correct the ills associated with analog cable. DTH, which started as a fragment of the distribution industry pie is now already the preferred medium for watching television.
Though the postponement of the digitization deadline came as a negative surprise, we hope that the October 30th timeline will be adhered to.
With much to look forward to, Dish TV remains well prepared for the digitization run with its efficient ground infrastructure and ability to seed set top boxes within a short turnaround time.
Mr Jawahar Goel, Managing Director, said,
The first quarter witnessed a partial comeback post the sluggishness before that. However, enhanced consumer demand owing to digitization is yet to fully reflect in acquisition numbers. Nevertheless, sensing DTH's growing popularity over competition, Dish TV recently initiated a price hike at the entry level as well as across standard definition packs.
While some restrain in customer demand in the short term cannot be ruled out, the net impact going forward is going to be ARPU accretive. Moreover, with digitization around the corner, subscription revenues are expected to increase as viewers sample better content on their television. The government, at its end, has been sending firm signals to the industry that there would be no further extension of the deadline.
Dish TV maintained its leadership share while continuing to focus on the quality of subscribers joining the platform. Churn sustained its downward movement, closing at 1% per month, while ARPU strengthened to Rs 156, mainly due to the price hikes taken previously. Efficiencies at the cost front helped enhance operating margins despite normalized lease rentals flattening the top-line growth. Enhanced offer fee, coupled with higher number of subscriber adds sequentially, maintained subscriber acquisition cost largely in line with the previous quarter.
Shareholding Pattern
The Promoters stake stood at 64.75% for March 2012. The Promoters have pledged 35.01% of the shares as % of total share holding of promoter and promoter group
Valuation
The stock is trading around Rs 70.8 on the bourses.
Dish TV India: Standalone Results
| 1206(03) | 1106(03) | Y-o-Y Var. (%) | 1203(03) | Q-o-Q Var. (%) | 1203(12) | 1103(12) | Y-o-Y Var. (%) |
| Net Sales | 519.96 | 463.44 | 12 | 524.72 | -1 | 1957.82 | 1436.55 | 36 |
| OPM (%) | 29.9 | 26.4 | | 27.5 | | 25.5 | 16.6 | |
| OP | 155.59 | 122.48 | 27 | 144.22 | 8 | 498.36 | 238.80 | 109 |
| Other Income | 10.57 | 13.67 | -23 | 9.41 | 12 | 38.59 | 88.03 | -56 |
| PBIDT | 166.16 | 136.15 | 22 | 153.63 | 8 | 536.95 | 326.83 | 64 |
| Interest | 47.28 | 33.40 | 42 | 34.82 | 36 | 177.80 | 151.14 | 18 |
| PBDT | 118.88 | 102.75 | 16 | 118.81 | 0 | 359.15 | 175.69 | 104 |
| Depreciation / Amortization | 151.20 | 121.07 | 25 | 167.83 | -10 | 518.00 | 365.40 | 42 |
| PBT before EO | -32.32 | -18.32 | 76 | -49.02 | -34 | -158.85 | -189.71 | -16 |
| EO | 0.00 | 0.00 | | 0.00 | | 0.00 | 0.00 | |
| PBT after EO | -32.32 | -18.32 | 76 | -49.02 | -34 | -158.85 | -189.71 | -16 |
| Tax | 0.00 | 0.00 | | 0.00 | | 0.00 | 0.00 | |
| PAT | -32.32 | -18.32 | 76 | -49.02 | -34 | -158.85 | -189.71 | -16 |
| EPS * | # | # | | # | | # | # | |
Not Annualised Current equity of Rs 106.4 crore of F V: Re 1
Var. (%) exceeding 999 has been truncated to 999
LP: Loss to Profit PL: Profit to Loss
EO: Extraordinary items
EPS is calculated after excluding EO and relevant tax
Figures in Rs crore
Source: Capitaline Corporate Database |