Highlights of the call

• For the second quarter of FY08, on standalone basis, Cinemax reported 22% growth in operating revenues at Rs 16.86 crore with operating margins up 190bps at 26.4% and the PAT grew 245% at Rs 2.90 crore.

• For the second quarter of FY08, on consolidated basis, Cinemax reported operating revenues at Rs 26.31 crore with operating margins at 29.6% and the PAT at Rs 4.61 crore.

• The revenues from construction & retail activities were at Rs 1 lakh leading to higher margins and profitability.

• The footfalls for the first half were 31 lakh with average occupancy of 33%. As per management break-even occupancy is 17-18%. The ATP was Rs 132 and F&B spent was Rs 30. Currently the company operates 4.91 shows per screen per day.

• The company added one property during the quarter in Haryana – 3 screens and 720 seats. The total capacity has increased to 14 properties with 42 screens and 11748 seats. Of the 14 properties: 8 properties are owned and 6 are on lease (200000 sq feet) at Rs 30-65 per sq feet.

• Going forward, the company has plans to increase it to 29 properties and 100 screens and in FY09 to 49 properties and 165 screens lower than its earlier guidance.

• The company has 4 properties ready for opening but is not getting clearance from the mall operators. These properties would come up in Q3FY08.

• There is delay in the Nagpur property, due to clearance issue. The property would come up in the next 1-1.5 months. 85-90% of the area is on lease. The rental income would be from 70,000 sq. feet of property at about Rs 60-65 per sq. feet meaning Rs 45-50 lakh per month. From the multiplex and gaming zone the company expects to earn about Rs 40-50 lakh a month.

• The effect of entertainment tax on OPM is about 5-7%.

• The gaming zone is expected to earn revenues of Rs 1.25 crore per annum and including Nagpur property about Rs 2.25-2.50 crore. The payback for gaming zone is 3 years.

• Out of the Theatrical revenues 75% is ticket sales, 15% is F&B revenues, 5% is advertising revenues and others 5%.

• The cost to set up 1 screen with 200-250 seats is Rs 1.5-2 crore, Rs 60000-70000 per seat.