(Reuters) -India’s Zee Entertainment reported an 85% jump in fourth-quarter profit on Thursday, as higher subscriptions and more film releases offset weak advertising demand.
Zee, which owns TV channels, produces movies and runs an online streaming platform, reported an 85% surge in consolidated pre-tax profit to 2.62 billion rupees ($30.65 million) for the three months ended March 31, from 1.42 billion rupees last year.
Subscription revenue rose 3.9%, helped by revenue growth from its TV channels and Zee5 streaming platform.
Overall revenue rose 1.6% to 22.2 billion rupees, while other sales revenue grew over three-fold, boosted by an increase in the number of movie releases during the quarter and higher syndication income from selling content rights.
However, advertising revenue came in 25% below last year, marking its tenth decline in the past eleven quarters, hurt by a weak advertising environment.
A shift in advertisement budgets to sports media platforms on account of the cricket events like the Champions Trophy and Indian Premier League and muted ad demand from consumer good makers, likely hurt non-sports broadcasters during the quarter, analysts said.
The broadcaster has been, of late, focusing on improving its subscriptions and other sales revenue, cutting costs and reducing losses as a sustainable recovery in advertising – typically the biggest contributor to revenue – remains elusive.
Zee’s cost cutting and frugality measures, helped reduce its expenses by 4.2%, pushing up its core profit margin to 13.1%, compared to 9.7% last year. It aims to reach a margin of 18%-20% by fiscal year 2026.
Core losses in Zee5 narrowed 71.6%, and revenue rose 16% led by higher syndication revenue.
Zee shares closed 1.4% higher ahead of results.
($1 = 85.4720 Indian rupees)
(Reporting by Aleef Jahan in Bengaluru)
