GECs
Network18 Media on a turnaround trail
MUMBAI: The Network18 group is doing very well, thank you. The group’s media holding company Network18 Media & Investments has reported results which show that the management led by managing director Raghav Bahl and group CEO B. Saikumar is slowly but surely driving it back to profits.
The company has reported revenues of Rs 679.5 crore in Q4 FY 2013 as against Rs 697.4 crore in Q3 FY 2013. Revenues for the full financial year ending 31 March 2013 are at Rs 2400.8 crore as against Rs 1943.8 crore – a jump of 23.51 per cent. This was driven primarily by an almost doubling in revenues from its digital content and ecommerce vertical to Rs 400.9 crore (from Rs 233.8 crore) for the whole year. Its television and motion picture vertical too leaped ahead 36.62 per cent in revenues to Rs 1725.5 crore (Rs 1262.9 crore).
The company shaved off its operating expenses for Q4 2013 to Rs 666.8 crore from Rs 686.8 crore in Q3 FY 2013. For the whole year ending 31 March 2013, its operating expenses rose to Rs 2440.1 crore (Rs 2239.9 crore).
Operating profits for the group during Q4 2013 were at Rs 12.8 crore against Rs 10.6 crore during Q3 FY 2013 keeping its operating margin at 2 per cent. During Q4 FY 2013, there was a drop in the company’s television and motion picture unit’s operating profits to Rs 34.6 crore (from Rs 48.1 crore). The operating losses for its digital content and e-commerce vertical fell to Rs 24.3 crore from Rs 31.3 crore in this period. The operating margins for its television and motion picture business in Q4 FY 2013 decreased to seven per cent (nine per cent in Q3 FY 2013).
For the whole year, there has been a drastic reduction in its operating losses to Rs 39.2 crore (Rs 296 crore). Its television and motion picture business which reported operating profits of Rs 107.1 crore (Rs 1.6 c rore) and allied businesses (publishing), which saw a decrease in losses to Rs 46.9 crore from Rs 118.8 crore, helped staunch the red ink. Its digital and e-commerce business continued to lose money operationally with an operating loss of Rs 125.4 crore (Rs 126.3 crore). The operating margins for its TV and motion pictures have improved from 0 to 6 per cent for the full year.
Network18’s consolidated debt as on 31 March 2013 stood at Rs 211 crore, down 90 per cent from Rs 2130 crore at the end of FY12.
Interest costs for Q4 FY 2013 were reduced to Rs 38.9 crore (Rs 53.1 crore in Q3 FY 2013). For the whole year it managed to keep its interest cost under control at Rs 272 crore (Rs 270.7 crore in FY 2012).
It managed to report a net profit of Rs 50 lakh in Q4 FY 2013 (Rs 6.8 crore in Q3 Fy 2013). For the full year, it managed to improve its bottomline with a reduction in losses to Rs 105.5 crore (Rs 392.7 crore).
During the year, Network18 profitably sold its entire stake in Newswire18, divested its Yellow Pages and Askme businesses and diluted its majority stake in Book My Show. These transactions, in line with the strategy to exit non-core businesses, added Rs 180 crore to the annual profit and raised Rs 235 crore for the Network18 Group.
Says Bahl: “We are delighted to inform our investors and stakeholders that at both Network18 and TV18, we have successfully deleveraged our balance sheets and have delivered strong operating performances. Network18s and TV18s net debt now stands at less than one-fifth of the peak levels and our interest payments have come down sharply. We are confident that we are now entering a sustained value creation phase in our journey as we continue to strengthen our existing operations and consolidate our regional acquisition.”
Adds B. Saikumar: “We are extremely pleased that our digital and broadcast operations have turned in a sustained and healthy operating performance during the year despite softness in the advertising environment. Our e-commerce businesses have turned in another stellar year and our digital content businesses continue to grow steadily. We are now on a solid net distribution income trajectory and while our flagship channels like CNBC TV18/Awaaz, Colors and CNN IBN continue to perform admirably, we are also enthused by the performance of recent launches and the motion pictures business. Inspite of near term challenges given the macro-economic headwinds, we are hopeful of delivering a strong year ahead.”
GECs
Sebi sends show-cause notice to Zee over fund diversion, company responds
Regulator questions 2018 letter of comfort and governance lapses; company vows robust legal response
MUMBAI: India’s markets watchdog has reignited its long-running scrutiny of Zee Entertainment Enterprises, issuing a sweeping show-cause notice that drags the broadcaster and 84 others into a widening governance storm.
The notice, dated February 12, has been served by the Securities and Exchange Board of India to Zee, chairman emeritus Subhash Chandra and managing director and chief executive Punit Goenka, among others. At its heart: allegations that company funds were indirectly routed to settle liabilities of entities linked to the Essel Group.
The regulator’s probe traces its roots to November 2019, when two independent directors resigned from Zee’s board, flagging concerns over the alleged appropriation of fixed deposits by Yes Bank. The deposits were reportedly adjusted against loans extended to Essel Group entities, triggering questions about related-party dealings and board oversight.
A key flashpoint is a letter of comfort dated September 4, 2018, issued by Subhash Chandra in his dual capacity as chairman of Zee and the Essel Group. The document, linked to credit facilities availed by certain group companies from Yes Bank, was allegedly known only to select members of management and not disclosed to the full board—an omission SEBI believes raises red flags over transparency and governance controls.
Zee has pushed back hard. In a statement, the company said it “strongly refutes” the allegations against it and its board members and will file a detailed response. It expressed confidence that SEBI would conduct a fair review and signalled readiness to pursue all legal remedies to protect shareholder interests.
The notice marks the latest twist in a saga that has shadowed the broadcaster since 2019. What began as boardroom unease has morphed into a full-blown regulatory confrontation. The final reckoning now rests with SEBI—but the reputational stakes for Zee, and the message for India Inc on governance discipline, could scarcely be higher.
