Performance for the quarter ended March 2014

On standalone basis, the company's net revenue was up by 9% to Rs 114.51 crore driven by volume, effective rate hike and multiple income streams. OPM declined by 570 bps to 27.6% mainly due to increase in marketing expenses by 610 bps to 34.5%, other expenses by 200 bps to 11.9% and production expenses by 90 bps to 4.2% of net sales. Marketing costs higher due to introduction of new TV property viz. Mirchi Top20. Other expenses in Q4 of last year included brand capital writeback of Rs.9.4 crore. The operating profit decreased by 10% to Rs 31.59 crore.

Other income stood at Rs 5.96 crore, up 61%. Depreciation and amortization stood at Rs 7.95 crore. The profit before tax declined by 4% to Rs 29.58 crore.

Tax was up by 60% to Rs 8.33 crore. Tax rate increased from 16.86% to 28.17%. The net profit declined by 17% to Rs 21.24 crore due to decrease in operating margin and increase in tax rate.

Performance for the year ended March 2014

The company has reported 13% incline in operating revenues at consolidated level to Rs 384.81 crore. OPM was up by 170 bps to 32.5%. As a result, the operating profit was up by 20% to Rs 124.89 crore. The consolidated net profit was up by 22% to Rs 83.62 crore.

On standalone basis, the company's net sales was up by 14% to Rs 384.81 crore driven by volume, effective rate hike and multiple income streams. OPM increased by 170 bps to 32.5% mainly due to fall in employee cost by 220 bps to 19.5% and other expenditure by 80 bps to 17.2% of sales. Other expenses in previous year included brand capital writeback of Rs 5.89 crore. The operating profit was up by 20% to Rs 124.98 crore.

Other income stood at Rs 22.36 crore, up 32%. Depreciation and amortization was almost stagnant at Rs 31.81 crore. The profit before tax was up by 29% to Rs 115.5 crore.

Tax outgo increased by 47% to Rs 32.05 crore. Tax rate was around 27.74%, up from 24.34%. The net profit was up by 23% to Rs 83.45 crore due to increase in operating margin and other income.

Management Comments

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

It's been a very satisfactory year. During the year, we strengthened our revenue market share, did exciting things with our brand and launched a new property, the Mirchi Top 20. Our PAT has risen to Rs 83 crore and the free cash generation to Rs 118 crore. Free cash position as on March 31, 2014 stands at Rs 440 crore. The really good news is that the Phase 3 auction process has already started in April this year. We now believe auctions will happen before the calendar year is out.

Other Developments

• The company retained market leadership with approximately 33%-35% share of private FM radio industry

• As per the last Indian Readership Survey (IRS), Radio Mirchi is a clear leader with #1 position in 22 out of the 32 markets in which it operates.

• It has launched a new TV property, Mirchi Top 20

• 6th edition of Mirchi Music Awards – Hindi, 3rd edition of Mirchi Music Awards – Bangla & 2nd edition of Mirchi Music Awards – Marathi executed successfully.

• Online music stations Devraag (Devotional music channel) & Filmy Mirchi (Latest Bollywood Music channel) launched on www.radiomirchi.com

• The Company has transformed from a pure radio company to a "media agnostic solutions" company which will develop multi-media solutions to clients

• The board of directors have recommended a dividend of 10% i.e. Re. 1/- per equity share of Rs.10/-.

Shareholding Pattern

The promoter holding stood at 71.15%.

Valuation

The share is trading at Rs 408.9 on BSE