**Rajiv Verma, CEO addressed the call.**Highlights of the call by Capital Mkt;
For the quarter ended March 2014, sales grew 9% to Rs 543.80 crore. OPM was down from 14.3% to 13.9% which limited OP growth to 5% to Rs 75.40 crore.
It saw 10% increase in advertising revenues of print segment to Rs 417.2 crore primarily driven by increase in advertising yields.
Circulation revenues of print segment grew 14% to Rs 65.5 crore primarily driven by increase in realisation per copy.PBT jumped 31% to Rs 78.50 crore.
Provision for tax jumped 117% to Rs 36.30 crore.Thus PAT fell 2% to Rs 42.20 crore.
Minority interest jumped 155% to Rs 7.40 crore after which net profit fell 13% to Rs 34.80 crore.In FY 2014 2014, sales grew 9% to Rs 2200.70 crore.
The company witnessed 9% increase in advertising revenues of print segment to Rs 1665.2 crore against Rs 1529.3 crore primarily driven by increase in advertising yields and volumes.
It saw 15% increase in circulation revenues of print segment to Rs 257 crore from Rs 222.6 crore primarily driven by increase in realisation per copy.
OPM improved from 14.0% to 14.2% which saw OP rising 11% to Rs 312.40 crore due to growth in advertising and circulation revenues.
PBT jumped 35% to Rs 324.00 crore.Net profit grew 24% to Rs 207.50 crore.
FY 2014 was extremely difficult year
FY 2014 was extremely difficult year for all the companies in the print media business/. Exchange rate fluctuation made it difficult for the company to ascertain how much its costs would be as its major raw material was newsprint. Also the economy was down so advertisement spend was not at the same degree that the management would have liked it to be. However, at the end of the year exchange rate stabilized and the rupee strengthened so the company managed to tackle the costs in a better way.
The Hindi business OPM grew to 21% from 18%. The company has started this business in the last 7 years so bringing the OPM to 21% is commendable.
HT media is one of the few companies having balanced portfolio in Hindi and English newspaper business.
The company has 4 radio stations in Mumbai, Dehli, Bangalore and Kolkata. EBIDTA has improved 130%. The company is ready with expansion of radio franchise as and when government allows.
The company has 2 vertical in education business: they are coaching center and higher education. Both these verticals are in interesting phase.
Increased its readership and consolidates its 2nd position
There were controversies in the IRS Readership data but the company got the permission from the court to share the dada with everyone including the analysts, advertisers, customers etc.
Hindustan is the second largest newspaper. It is very strong in UP, Bihar and Delhi.
Mint is number 2 business newspaper.
HTML increased its readership and consolidates its 2nd position in the English, Hindi and Business Daily Segments.
On all India basis, 2013 IRS Readership stood at 4.34 million against 3.82 million as per Q4 2012 IRS Readership.
In Delhi NCR it grew from 2.18 million to 2.27 million.
Mint grew from 0.22 million to 0.31 million during the same period.
Benefits of strong IRS performance will accrue in years to come. Thus yields will climb up in Delhi and Mumbai.Mumbai has become from 3 paper market to 2 paper market.
HT readership is 12.5 lakh compared to 20 lakh odd for the number one player. Third player is so far away that it is inconsequential.
HT media is the only company to close the gap between the top player and second player.
The company has been investing in digital arena since the past 7-8 years.
Digital business continues to report buoyant performance for the Fiscal Year 2013-14. It saw 42% increase in revenues from Digital segment to Rs 76.2 crore from Rs 53.8 crore.
Shine.com saw revenues growing 58% in FY14 over FY13.
HT Mobile registered a revenue growth of 65% in FY 14 over FY 13
Revenue from Shine is Rs 24 crore and total job portal business is worth Rs 250 crore thus there is lot of gap to close.
Robust performance from Radio Business continues
Radio Business saw 19% increase in revenues to Rs 93.1 crore in FY 14 from Rs 78.3 crore in FY13.
EBITDA grew 129% to Rs 28.5 crore from Rs 12.5 crore; Margin improved to 31% from 16% during the same period for the Radio Business.
Total investment for this company is 300 crore and 60% is in properties.
During the March 2014 quarter Newsprint price grew from Rs 34500 to Rs 39500.
Capital allocation of the company will mostly be in Hindi and new business like education, radio and digital. For English newspaper it will not me much in Delhi and NCR. But it will invest somewhat in Mumbai English newspaper business.
Northwestern University forged JV with Bridge School of Management, a part of HT Media. The Joint Venture is on âPredictive Analytics’ professional certificate programmes in India, with the first programme to be launched early this summer.
The program will combine online content (developed and taught by Northwestern faculty) with weekly in-person sessions led by local faculty at Bridge School’s learning centers in Delhi.
Buy back plans
The company feels that it makes more sense for buy back than giving higher dividend but the company will have to wait for 12 months for another buyback from the end of previous buyback.
Resilient business model, established brands and sustained focus on cost reduction will continue to drive growth and create value
The company’s diversification strategy has worked well. HT Mumbai, Hindustan â especially in Uttar Pradesh, and its digital businesses have delivered strong growth. Its radio business continues to grow both revenue and profits.
The management is confident that its diversified and resilient business model, established brands and sustained focus on cost reduction will continue to drive growth and create value
HT Media’s business outlook continues to be strong on the back of increasing returns in new businesses like HT Mumbai, Radio.
Going forward Hindi business will contribute towards revenue growth and improved profitability.
The company is also gaining traction in the digital businesses.
The company boasts of strong balance sheet capable of supporting investments in growing businesses whilst exploring new opportunities. It has net cash of Rs 901.3 crore.