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UTV Gaming Revenues At $3.45 M; Plans $75 M Gaming Investments; Fund US Startup, Acquire Mobile Games Aggregator

It looks like BSE listed UTV Software is planning to add Online Gaming to its existing portfolio of console and mobile gaming companies.  UTVs board has “taken on record” proposals regarding $75 million in investments in three key initiatives in the Gaming space:

  • Investment in a prominent US based startup in the Online Gaming space
  • The acquisition of a US based mobile games aggregator (Ed: Will complement Indiagames)
  • Ignition: Increasing its stake in Ignition entertainment from 70 percent to 95 percent by buying out an existing investor. We had written about this earlier. Also planned is an increase investment in Ignition for its three console games being developed in London, Florida and Tokyo.

Download UTVs financial results here.

UTVUTV has been restructuring its business over the past year, so the earnings results for this quarter aren’t really comparable with any of the previous ones: last year, their financials incorporated numbers from Indiagames, and UTV had also sold off their post-production business; during Q1 2008-09, UTV completed the acquisition of IT Nation, and added a New Media segment, which also includes UTV New Media Ltd. Animation has now been shifted from the Interactive segment to the Films segment. Like I said – it’s difficult to judge the growth of the company, and compare Q1 2008-09 results with previous quarters. So just the numbers, and some pointers:

UTVs Interactive business, which now comprises only of IndiaGames and Ignition Entertainment reported revenues of Rs. 14.559 crores for the quarter ending June 30th 2008. However, the segment reported an EBITDA loss of Rs. 3.57 crores, and a significant amount of investment – Rs. 133.79 crores. A spokesperson told us that the gaming segment should be looked at on an annual basis, since the product cycle tends to be long (particularly for Ignition, which is developing console games).

New Media
UTVs New Media segment, which includes UTV New Media Ltd (UNML) and ITNation, reported a loss of Rs. 63.8 lakhs at the EBITDA level, and revenues of Rs. 2.6 crores. Remember that UTV completed the acquisition of 76.5 percent equity in IT Nation Media Pvt Ltd in May. We noted that UTV has invested just Rs. 12.16 crores in the New Media segment, while they are reported to have paid almost Rs. 15 crores for acquiring ITNation. A company spokesperson told us that the pay-out hasn’t been completed yet, and this will be reflected in future quarters as well.

Note that the company had earlier announced an overall digital spend of Rs. 120 crores over the next two years. Now if only we knew what all they meant by digital.

No comments yet on music, but UTV has told us that Music will be part of the Films segment in the financials. However, there was one significant development in the music space in the quarter – UTV went ahead and sold music rights for 14 of its films to T-Series, even though UTV has its own label UTV Music, and they are buying music rights from other content owners. Strange.

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