The company’s July-September revenue had fallen by 6% even as costs rose, pushing it to a rare loss of Rs 19 cr before non-cash, non-operating items (operating profit or EBITDA).
The company had seen a 7% decline in revenue in the preceding Apr-Jun quarter too, but had still managed to post a profit of Rs 36 cr at the EBITDA level, down from 70 cr in 2017.
Compared with the June quarter, two key factors pushed the company to a loss — a sequential decline of Rs 29 cr in revenue and a Rs 24 cr jump in employee expenses.
Raw material costs, though up by Rs 39 cr on a year-on-year basis, was flat on a sequential basis, and did not contribute to the swing to the loss from a sequential basis.
On a positive note, the company’s revenue from non-operating activities (other income) saw a sharp increase in the September quarter to Rs 53 cr from Rs 27 cr in the June quarter.
As a result, operating profit including other income was at Rs 34 cr in the latest quarter compared to Rs 63 cr in the June quarter. A year ago, it was at Rs 147 cr.
At a net level, the company was at a loss of Rs 42 cr in the September quarter, versus a profit of Rs 6 cr in the preceding three months and a profit of Rs 66 cr in the previous year.
AD SALES HIT
The company, one of India’s top newspaper publishers, blamed poor advertising sentiment for the performance.
Overall print revenue fell Rs 43 cr on year to Rs 448 cr. On a sequential basis too, it was down by Rs 30 cr.
While the year-on-year decline in print revenue was 7% in the June quarter, it accelerated to 9% in the September quarter.
The company, which had blamed “delayed advertising recovery on account of macro factors” in June quarter, said “advertising environment remained soft” in September quarter as well.
It said there was “continued delay in revival of ad spends, particularly by national advertisers.”
Sectors like government, real estate and e-commerce reported ad revenue growth, while retail, automobiles and entertainment disappointed, it said.
“Print advertising is yet to see a revival on account of muted ad spends by national advertisers, further accentuated by the base effect due to the shifting of the festive season to the third quarter of the year,” said Chairperson Shobhana Bhartia.
“Hindi business showed a recovery in circulation revenue.”
She said costs were hit by rising commodity prices and depreciation in the value of the rupee.
Radio revenue increased by Rs 4 cr to Rs 47 cr this year, but was flat sequentially.
“Our Radio business continues to post strong performance with double digit revenue growth along with an improvement in profitability.
“We are hopeful that the upcoming festive season and the forthcoming parliamentary elections will lead to a resurgence in advertiser sentiment in the second half of the year,” she added.