Entertainment Network (India) (ENIL) Q4 10/11 earnings summary

Executive summary

• FY11 revenue and profitability rebounded, supported by stronger advertising demand, cost control and a revised music royalty framework.

• Radio Mirchi operated in 32 cities and reported 41.2 million listeners in IRS Q4 2010; leadership and digital expansion remained central priorities.

• Proceeds from selling the Out of Home subsidiary strengthened liquidity and helped prepare for the expected Phase III radio expansion.

Financial highlights

• Consolidated total income was ₹46,512.47 lakh vs ₹42,353.81 lakh in FY10; EBITDA before exceptional items was ₹10,319.26 lakh vs ₹4,519.70 lakh.

• Consolidated net profit was ₹1,717.45 lakh vs a ₹1,532.14 lakh loss in FY10; diluted EPS was ₹3.60 vs a ₹3.21 loss.

• Standalone total income rose to ₹2,835.7 million from ₹2,311.9 million; PAT was ₹522.1 million, including a ₹126.8 million gain on sale of a subsidiary.

• Radio business revenue reached ₹280 crore, up 21.3%; EBITDA rose 52.5% to ₹91 crore. Q4 revenue grew 34.2% and EBITDA nearly 120%.

Outlook and guidance

• Phase III was expected in the coming months; the anticipated expansion could take radio from 86 towns and ~245 frequencies to over 300 towns and 800+ frequencies.

• Preparations included market sizing and a dedicated strategy team; bidding would be strong but disciplined, with profitability prioritized over network size.

• Management expected buoyant economic conditions, consumer spending and advertising momentum to support growth in the year ahead; digital and mobile initiatives were also set to expand.