Entertainment Network (India) (ENIL) Q4 17/18 earnings summary

Executive summary

• FY18 was a strategic pause: ad volumes were cut ~15% to improve listener experience; revenue fell 5.1% and PAT fell 35.5% YoY.

• Pricing rose 5.5% as listenership leadership strengthened; non-radio gross margins expanded to 24% from 19%.

• FY19 revenue and PAT were expected to expand as new stations, premium second frequencies and digital offerings scaled.

Financial highlights

• Standalone total income was ₹54,590.52 lakh vs ₹57,537.10 lakh; PAT was ₹3,515.89 lakh vs ₹5,447.40 lakh.

• Consolidated total income was ₹54,652.33 lakh vs ₹57,606.07 lakh; PAT was ₹3,563.99 lakh vs ₹5,516.96 lakh.

• Standalone operating revenue was ₹52,674.95 lakh vs ₹54,872.43 lakh; revenue from operations in the radio business declined 3.4% to ₹537.1 crore.

• EBITDA, excluding exceptional items, was ₹12,542.6 lakh vs ₹14,548.7 lakh; EBITDA margin was 23.0% vs 25.3%.

• Standalone EPS was ₹7.38 vs ₹11.43; consolidated EPS was ₹7.48 vs ₹11.57.

Outlook and guidance

• FY19 revenue and PAT were expected to recover and expand after the FY18 strategic pause.

• The network was expected to reach 76 stations in 63 cities; Phase 3 Batch 2 stations were expected to launch in FY19.

• Management expected new Phase 3 stations to contribute positively in coming years, with stronger state networks supporting advertising demand.

• Digital was identified as a growth opportunity, with plans to invest in online streaming and extend Mirchi Play across platforms.