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PERFORMANCE REVIEW:Q3 FY07January 19, 2007
INVESTOR UPDATE
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INDEX
• The Company
• Operating Highlights
• Q3FY2007 Performance Overview
• Condensed Statement Of Operations
• Financial Overview
• Future Outlook and Strategy
• Investor Communication
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Entertainment Network (India) Limited (ENIL) is India's first pure play radio
broadcasting company to go public and is listed on the BSE and NSE.
Incorporated in June, 1999, ENIL currently operates FM radio broadcasting
stations in ten cities under the brand Radio Mirchi. The company has its
headquarters in Mumbai, India and is the only commercial FM broadcaster
exclusively present in 10 cities
ENIL has a 100% owned subsidiary, Times Innovative Media Private Limited
("TIMPL") through which it operates its out-of-home media business (brand
Times OOH Media) and experiential marketing business (brand 3600
Experience)
The financial results discussed in this update are not Consolidated
THE COMPANY
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KEY OPERATING HIGHLIGHTS
Further Consolidates its Dominance
� According to data based on Indian Listenership Track (ILT –Wave 10 conducted by MRUC) for the period September-November 2006, Radio Mirchi retained the number one position in Mumbai and Delhi while establishing itself as the dominant number one station in Kolkata too. Radio Mirchi has increased its lead over #2 player in Mumbai from 30% to 40% while maintaining its 2:1 lead in Delhi
� In Mumbai, Radio Mirchi dominated listenership with 2.63 million out of a total of 5.30 million daily listeners, in Delhi it has 4.2 million out of 6.1 million daily listeners and in Kolkata 2.7 million out of total 4.0 million listeners
� In Kolkata, Radio Mirchi has more listeners than all other radio stations combined and is the second largest media vehicle in thecity after the leading Bengali daily
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Million
Listenership in Mumbai Listenership in Delhi
Million
Source: MRUC Survey, AC Neilson (ORG-Marg-Wave10, fieldwork September, 06 to November, 06.
ORG-Marg-Wave 9, fieldwork July 06 to September 9, 06.
ORG-Marg-Wave 8, fieldwork Jan 06 to Mar 06, All Sec 12+)
KEY OPERATING HIGHLIGHTS (Cont’d…)#1 in Listenership
0.0
1.0
2.0
3.0
Radio Mirchi Radio City Red FM Go/ Radio one
ILT Wave 8 ILT Wave 9 ILT Wave 10
2.05
2.212.6
1.91.73 1.89
1.2
1.58 1.66
0.25
0.94 0.97
0.0
1.0
2.0
3.0
4.0
5.0
Radio Mirchi Radio City Red FM
ILT Wave 8 ILT Wave 9 ILT Wave 10
3.6
4.46 4.2
1.7
2.2 2.09
1.35
2.83
2.0
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KEY OPERATING HIGHLIGHTS (Cont’d…)#1 in Listenership
Source: MRUC Survey, AC Neilson (ORG-Marg-Wave10, fieldwork
September, 06 to November, 06. All Sec 12+)
0.0
1.0
2.0
3.0
ILT Wave 10
Radio Mirchi Red FM Aamar FM 106.2
2.73
0.76
0.58
Listenership in Kolkata
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KEY OPERATING HIGHLIGHTS (Cont’d…)
Leads content innovation
� Radio Mirchi continues to remain the preferred radio partners for all big banner movies released in the country. Some examples of recent films are Vivaah, Babul, Kabul Express, Dhoom2 and Guru- Coming up is Salaam-e-Ishq
Signed agreement with T-series for Music royalty
� We have signed a 9-year agreement with T-series, the largest music company in India
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Times OOH Media installed two LED video matrix
screens at a prime slot in Mumbai Airport
Entry in Pune market by winning eight hoardings on prime locations
360 Degrees established its first IPR owned property named Smart Living Awards for recognizing excellence
in the housing and related industry
KEY OPERATING HIGHLIGHTS – TIMPL
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� Total Income of Rs.484.1 million, growth of 30.7%
� Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA) stood at Rs. 176.5 million, up
20.8%
� EBITDA margin stood at 36.5%
� Net Profit at Rs. 124.0 million, growth of 13.9%
Q3FY2007 PERFORMANCE OVERVIEW(All comparisons with Q3FY2006)
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On a like basis (excluding 3 new stations):
� Total Income of Rs. 392.1 million, growth of 5.8%
� EBITDA stood at Rs. 151.1 million, up 3.4%
� EBITDA margin stood at 38.5%
The new stations namely Bangalore, Hyderabad and Jaipur achieved break-even during the quarter and reported an healthy EBITDA margin of 28% for the quarter
Q3FY2007 PERFORMANCE OVERVIEW (Cont’d…) (All comparisons with Q3FY2006)
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13.9%
(18.5%)
13.1%
5.1%
56.4%
38.8%
20.8%
36.9%
30.6%
122.7%
28.7%
YoY Growth
(%)
14.8%25.6%Margin (%)
(4.4%)186.4124.0Profit After Tax (PAT)
(56.2%)7.12.2Less: Taxation
(0.7%)193.4126.2Profit Before Tax (PBT)
148.7%9.74.1Financing cost
53.1%93.531.9Amortization
25.6%38.314.3Depreciation
26.5%36.5%Margin (%)
15.4%335.0176.5EBITDA
61.4%928.0307.5Operating Expenditure
46.0%1,263.0484.1Total Income
135.6%4.416.7Other Income
44.0%1,219.6467.3Airtime Sales
YoY
Growth (%)
YTD
Dec. 07
Q3 FY07(Rs. Million)
CONDENSED STATEMENT OF OPERATIONS
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Revenues:
�Total Income of Rs.484.1 million, growth of 30.7%- On like basis total income growth of 5.8%
�YoY revenue growth on account of new stations and value growth from existing stations
�Radio Mirchi made significant inroads into the three FM
stations (launched in April 2007) Bangalore, Hyderabad
and Jaipur, raking up listenership and achieving market leadership in revenues
FINANCIAL OVERVIEW
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FINANCIAL OVERVIEW (Cont’d…)
Earnings Before Interest, Tax, Depreciation and Amortizations (EBITDA) :
� EBITDA for the quarter increased by 20.8 % (YoY) to Rs. 176.5
million. On like basis EBITDA grew by 3.4 % (YoY)
� For the period ending December 06 EBITDA increased by 15.4 %
(YoY) to Rs.335.0 million. On like basis it grew by 19.6% (YoY)
� EBITDA margins have been protected in our seven (Phase I)
markets in spite of competition. Our margin was 33% on a YTD
basis and 39% in Q3 - same as last year. This is in spite of higher
spend in marketing this year (YTD: 25% of sales v/s 19% of sales
last financial year)
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FUTURE OUTLOOK AND STRATEGY
Ad industry is growing at 23% as per the recent Ad Ex India (a
division of Tam Media Research) study reported in Economic
Times and Business Standard. The size of the market in CY 2006 is estimated at Rs. 16.3 billion (Previous Year Rs. 13.2
billion)
The fastest growing media sector is radio – which has grown at
58% over the previous year
The long-term operating and financial performance outlook is encouraging as FM radio industry trends remain positive and
the Company continues to build upon its existing listenership
base and implements new initiatives in line with its growth
strategy
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FUTURE OUTLOOK AND STRATEGY
Expand our footprint in radio broadcasting
– Based on the present rate of progress, the Company is confident of
completing rollout of the remaining 22 stations by July 31, 2007
– Explore opportunities in international markets
Maintain market leadership in fast growing radio industry
– Development of listenership research standards and methodology; larger geographic coverage
– Keep investing in brand building and programming innovation
– Launch Visual Radio through mobile phones in other cities
– Leverage footprint to capture additional income sources
– Exploit additional revenue streams like Mirchi Activation
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INVESTOR COMMUNICATION
Entertainment Network is committed to improving its performance every fiscal and
continuously enhance shareholder value through successful implementation of its growth
plans. The company’s investor relations mission is to maintain an ongoing awareness of
its performance among shareholders and financial community. This update covers the
company’s financial performance for Q3 FY07
We thank you for your support and welcome your feedback and comments regarding this
update and other investor issues
For further information please contact:
N. Subramanian, Chief Financial Officer (CFO), ENIL
Tel: +91 (22) 67536983; Email: [email protected]
Dalpat Jain, Business Analyst, ENIL
Tel: +91 (22) 67536919; E-mail: [email protected]
Arun Rajendran, Adfactors PR
Tel: +91 (22) 22813565; Email: [email protected]
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Certain statements in this release concerning our future growth prospects are forward-looking
statements, which involve a number of risks, and uncertainties that could cause actual results to
differ materially from those in such forward-looking statements. The risks and uncertainties relating to
these statements include, but are not limited to, risks and uncertainties regarding fluctuations in
earnings, our ability to manage growth, intense competition in our business segments, change in
governmental policies, political instability, legal restrictions on raising capital, and unauthorized use of
our intellectual property and general economic conditions affecting our industry. ENIL may, from time
to time, make additional written and oral forward looking statements, including our reports to
shareholders. The Company does not undertake to update any forward-looking statement that may
be made from time to time by or on behalf of the company.
DISCLAIMER
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THANK YOU