Pawan Agarwal - Deputy Managing Director, addressed the meet.

Highlights of the call

Performance in the fourth quarter has reflected a culmination of all efforts, it undertook over the last one year, in implementing editorial and circulation expansion strategies.

Researchers visited over 20 lakh households and a team of 7000+ surveyors across 38 districts were deputed.

As evident, both have played out their complimentary roles and it has reported significant circulation led growth.

D.B. Corp registered a 10% rise in consolidated sales to Rs 567.81 crore for the quarter ended March 2018. OPM fell 450 bps to 17.2% which saw OP fall 13% to Rs 97.92 crore. PBT fell 17% to Rs 78.86 crore. PAT fell 11% to Rs 57.09 crore.

Consolidated Advertising Revenues grew 8.2% to Rs 386.1 crore. Volume growth was 80% and 20% from the yield.

Growing categories are Education, FMCG, Banking and Finance. Real Estate is showing some growth but not like how it used to grow originally.

The large growth it was expecting like double digit growth will be only if real estate and education etc grow in double digits.

The company was expecting good new launches in auto in Q4 but that did not happen.

Circulation revenue increased 8.5% to Rs 132.0 crore largely an outcome of Circulation expansion strategy.

EBITDA during Q4 FY 2018 stood at Rs 105.1 crore after considering forex loss of Rs 99 lakh. Excluding impact of circulation expansion related one off expenditure, EBIDTA growth would have been in mid single digit.

For FY 2018, D.B. Corp registered a 3% growth in consolidated sales to Rs 2328.49 crore. OPM fell 420 bps to 24.2% which saw OP fall 12% to Rs 563.76 crore.

PBT fell 14% to Rs 488.46 crore. PAT fell 14% to Rs 323.97 crore.

Excluding circulation expansion strategy related one off expenditure, PAT would have seen double digit growth. However the management conceded that investments are regular affair. However it just mentioned the details to let investors know that it is not going in wrong direction.

Advertising Revenues grew 3% to Rs 1642.5 crore.

Circulation Revenue grew 7% to Rs 514.5 crore, largely an outcome of volume growth driven by circulation expansion strategy and without any reduction in cover prices.

FY performance is not comparable on YOY basis as last year's figure included one-offs pertaining to private treaty billing.

In December 2016 quarter, the company had reversed the provision for royalty payable to Indian Performing Rights Society Rs 5.77 crore pertaining to the period before June 21, 2012, pursuant to decision of the Honorable Supreme Court of India, wherein the Honorable Court has rejected the demand raised by IPRS for royalty. This was netted of against the respective expenses head.

Q4 Radio business revenue grew by 9.5% to Rs 36.2 crore. PAT grew 70% to Rs 5.5 crore (margin 15%) from Rs 3.2 crore (margin 10%).

For FY 2018 excluding circulation expansion related one-off expenditures and previous year's non-recurring gains on account of Pvt treaty business deals and music royalty reversal of Radio business, EBIDTA has registered growth.

For FY 2018 excluding circulation expansion related one-off expenditures and previous year's nonrecurring gains on account of Pvt treaty business deals and music royalty reversal of Radio business, PAT has registered high single digit growth.

For FY 2018 Radio business EBIDTA stands at Rs 3602 crore with 27% margin. PAT stands at Rs 15.3 crore (11% margin).

Dainik Bhaskar Group has maintained its leadership as the Largest Newspaper Group of Urban India.

Circulation expansion strategy has delivered excellent growth of almost 18% in 9 months from around 51 lakh copies in June end 2017 to around 59.6 lakh copies in March end 2018, an increase of almost 9 lakh copies. This has been achieved through aggressive circulation campaigns and impactful on-ground activations & reader engagement initiatives across India.

The company successfully completed entire Bihar expansion drive. It aggressively expanded copies in circulation reflecting over 2 times growth across 38 districts covering key Tier 2 and 3 cities and towns in Bihar with around 7 lakh copies.

Focus markets remains the same in Gujarat, Bihar, and Rajasthan and the company is working hard to further increase circulation nos. in markets, where it is already enjoying a strong dominance, including MP , CG, Haryana and Chandigarh.

A key aspect of circulation strategies have been the strong reader engagement initiatives that helped in expanding its markets and attracting new readers.

Through these efforts, the company has been successful in also attracting the right profile of audiences in NCCS A and B categories also benefiting advertisers.

Its stringent business processes are ensuring that all its resources are prudently utilised, and through capabilities in technology, it has ensured that every team's efficiency and productivity is at their best.

The non-print businesses are also well synergised and strongly complement the overall package to advertisers and brands.

All fundamental business growth drivers are in place which positions us well to capitalise on emerging industry opportunities. The positive outlook on India reflected by global institutions is providing a strong impetus to the positive sentiment on-ground that signals a better new fiscal ahead.

Strong circulation growth reported is driven by a clear and focused editorial strategy that centres on ‘regular product reinvention' and offering content that meets the readers' needs, and become an ‘integral part of their lives.

Radio continues to be largest player in rest of Maharashtra and No. 1 in Chandigarh, Haryana, Punjab, Rajasthan, Madhya Pradesh & Chhattisgarh.

It is not looking at any kind of acquisition and further investments in radio.

The company does not need large cash in balance sheet.

This year capex was Rs 161 crore out of which Rs 30 crore went in Bihar and 25 crore in Rajasthan and Rs 20 crore in MP and Gujarat each. It spend Rs 11 crore in IT up gradation. .

In FY 2019 the requirement will be only for maintenance capex which will be of around Rs 60 crore.

The board is evaluating various options of returning cash to shareholders and this will happen in couple of months.

The company is striving to grow in double digits in Q1 but it is not sure if that will happen. Real estate is laggard from past 2 years due to one reason or another. But the management is not leaving any opportunities untapped.

Cover price in its region is in the range of Rs 4-5. So the management decided that it will not go for further price increase in near future. Thus most of the growth is volume growth.

The company tied up with a big AC manufacturer for advertising but summer got late and there were rains in Northern India the AC manufacturer reversed its commitment. In real Estate it was expected that after RERA things will improve but now investors are not investing in Real Estate and so even that sector is lagging behind.

Newsprint prices in Q4 was up 3.7% but that is not the real reflection. Real reflection will come in Q1 and Q2 which will be 12-15% yoy. By Q3 and Q4 newsprint prices should come down.