Release Date: August 02, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Consolidated revenue for Q1 FY25 increased to INR945 million from INR853 million in Q1 FY24.
- EBITDA for the quarter grew to INR66 million compared to INR163 million in Q1 FY24.
- The advertisement screen network expanded by 17% year-over-year, reaching 3,769 screens as of June 30, 2024.
- Revenue from government advertisements grew by 55%, from INR38 million in Q1 FY24 to INR59 million in Q1 FY25.
- The company remains net cash positive with a consolidated funds position of INR1,066 million as of June 2024.
Negative Points
- Net loss of INR42 million in Q1 FY25, compared to a net profit of INR25 million in Q1 FY24.
- Advertisement revenue declined to INR219 million from INR235 million in Q1 FY24.
- Corporate advertisement revenue dropped significantly to INR116 million from INR182 million in Q1 FY24.
- Technical revenues for the quarter decreased to INR240 million from INR248 million in Q1 FY24.
- The underperformance of major films and fewer movie releases negatively impacted the quarter's results.
Q & A Highlights
Highlights from UFO Moviez India Ltd (NSE:UFO, Financial) Q1 FY25 Earnings Call
Q: Can you provide a revenue split between multiplex and single screens?
A: (Rajesh Mishra, CEO) Multiplex screens generate higher revenue due to more frequent movie playouts. Advertisement revenue is sold as a network, so rates are flat across screens, but multiplexes drive higher billing due to more shows.
Q: How does the trend of increasing multiplex screens impact ad revenues?
A: (Ashish Malushte, CFO) The trend is positive as multiplexes attract more advertisers. New screens are mostly multiplexes, enhancing our network's value.
Q: How do fewer movie releases affect your business model?
A: (Rajesh Mishra, CEO) The business is seasonal. Fewer releases impact revenue, but the effect varies by quarter. Q2 and Q3 are typically stronger due to festive seasons.
Q: Why have expenses increased significantly this quarter?
A: (Ashish Malushte, CFO) The increase is mainly due to higher costs associated with product sales and advertisement share. These costs are linked to revenue-generating activities and are not a concern.
Q: What is the outlook for government advertisement revenue?
A: (Ashish Malushte, CFO) Central government allocations remain low, but state government and political party spending have increased. We are focusing on these areas for future growth.
Q: Can you explain the impact of the TSR network acquisition on advertisement revenue?
A: (Ashish Malushte, CFO) TSR's integration will take until Q3. Currently, we are paying a fixed fee, but once integrated, it will significantly boost our network's revenue potential.
Q: How does the partnership with NeuralGarage benefit UFO Moviez?
A: (Rajesh Mishra, CEO) NeuralGarage's VisualDub technology improves the quality of dubbed films by syncing lip movements with dialogues, enhancing viewer experience and potentially increasing demand for dubbed content.
Q: What is the potential of Caravan advertisement revenue?
A: (Ashish Malushte, CFO) Caravan has good margins and complements our advertising offerings, but its growth is limited by the number of vans. It is not a major revenue driver compared to our core advertising network.
Q: What are the plans for utilizing the significant cash reserves?
A: (Ashish Malushte, CFO) The cash is kept for potential business opportunities and acquisitions. Excess cash not used for business expansion will be returned to shareholders.
Q: Why is corporate and retail advertisement revenue still below pre-pandemic levels?
A: (Ashish Malushte, CFO) Corporate revenue is recovering and expected to outshine past performance. The key is consistent content quality to attract advertisers.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
