As per the recently published Indian Readership Survey (IRS) 2009 R2, Radio Mirchi has emerged as a clear leader with over 41 million listeners across the country. Radio Mirchi tops the charts with the largest cumulative listenership of 15.4 million in the eight key cities of Mumbai, Delhi, Kolkata, Hyderabad, Bangalore, Pune and Ahmedabad. It leads in 25 of its 32 cities across the country.

Quarterly Analysis (Consolidated)

For the quarter ended December 2009, ENIL reported 6% rise in operating revenues at Rs 116.77 crore. Revenues from radio business grew 6% at Rs 63.52 crore, OOH revenues grew 7% at Rs 42.76 crore and event management business revenues dipped 16% at Rs 10.83 crore.

OPM improved 980bps at 15.1%. As a of net sales, production costs dipped 130bps at 12%, employee cost decreased 200bps at 13.5% and license fees dipped 1010bps at 30.4% whereas marketing expenses increased 240bps at 6.3% and other expenditure increased 140bps at 22.7%. The resultant operating profits surged 198% at Rs 17.58 crore. Radio business reported improvement in OPM of 260bps at 33.2% whereas OOH business reported dip of 75% in operating losses at Rs 3.18 crore and event business reported loss of Rs 0.34 crore against marginal profit in the corresponding quarter previous year. The margins were impacted by provisioning for private treaty of Rs 5.83 crore.

Other income for the quarter was up 183% at Rs 13.37 lakh as compared to the corresponding quarter previous year. Interest cost (net) decreased 38% at Rs 3.01 crore and depreciation & amortization increased 3% at Rs 13.78 crore on the back of 5% increase in depreciation at Rs 8.11 crore. The resultant PBT was at Rs 0.93 crore against loss of Rs 12.30 crore in the corresponding quarter previous year. Tax provision including FBT and deferred tax was credit of Rs 1.55 lakh against provision of Rs 1.45 crore in the corresponding quarter previous year. The resultant PAT stood at Rs 0.94 crore against loss of Rs 13.75 crore in the corresponding quarter previous year. Accounting for share in loss of TIM of Rs 1.56 crore down 49%, the resultant net profit was at Rs 2.5 crore against loss of Rs 10.68 crore in the corresponding quarter previous year.

Nine months Performance (Consolidated)

For the nine months ended December 2009, ENIL reported 8% de-growth in operating revenues at Rs 302.53 crore. The revenues from radio business dipped 5% at Rs 169.68 crore. The revenues from OOH business were at Rs 110.15 crore and of event business was at Rs 24.15 crore.

OPM improved 250bps at 3.4%. As a % of operating revenues, marketing expenses decreased 130bps at 5%, license fees were down 250bps at 36.5% and employee costs decreased 250bps at 16.5% whereas production expenses increased 20bps at 12.8% and other expenditure increased 370bps at 25.9%. The resultant operating profit was up 248% at Rs 10.31 crore.

Radio business reported improvement in OPM of 560bps at 26.4% whereas OOH business reported operating losses at Rs 31.21 crore and event business reported loss of Rs 3.27 crore. The margins were impacted by provisioning for private treaty of Rs 14 crore.

Other Income stood at Rs 0.37 crore down 78%, and interest cost (net) decreased 15% at Rs 9.27 crore. Depreciation & amortization charge increased 4% at Rs 40.71 crore. Loss at PBT level for the period was Rs 39.30 crore down 14% against the corresponding period previous year. Tax provision including deferred tax was credit at Rs 0.46 crore against tax credit of Rs 1.73 crore in the corresponding period previous year. Loss of PAT level was down 11% at Rs 38.85 crore against the corresponding period previous year. Accounting for share in loss of TIM of Rs 8.11 crore up 16%, the resultant loss at net level was at Rs 30.74 crore down 17%.

Commenting on the performance of the company Mr Prashant Panday, CEO, ENIL said,

"We can now safely say that the worst is behind us! With revenues turning positive and with costs tightly under control, we expect the turnaround to gain strength. The IRS results of R2, 2009 are a big boost as it shows clearly that listenership shares of Mirchi are now stable and strong. Our revenue market share also remains strong at above 40%. We look forward to the Phase III policy announcements from the Ministry of I&B and resolution of the long pending music royalty issues."

Commenting on the performance, Mr. Sunder Hemrajani, Managing Director, TIM said:

"The business environment continued to improve during the quarter. The company recorded a very significant revenue growth of 17% over the previous quarter and is close to the pre-meltdown levels. The cost and productivity initiatives undertaken during the year are beginning to yield results leading to improvement in profitability of the business."

Shareholding Pattern

As of December 31, 2009, total foreign investors hold 8.51% (8.52% at end of sequential quarter), Promoters hold 71.15% (71.15% at end of sequential quarter), MFs/FIs & Banks hold 2.60% (2.40% at end of sequential quarter), and others hold 17.74% (17.94% at end of sequential quarter).

Valuation

The shares of the company are trading at Rs 223.15 on the bourses.