Dish TV Q2-FY13: Adds 477,000 Subscribers, Rs 55.1 Crore Profit

Dish TV, the Direct to Home television services operator, has reported operating revenues of Rs 533.6 crore for the quarter ending September 30, 2012, up 10.1% from the corresponding quarter last fiscal. The EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) for the quarter stood at Rs 155.7 crore, up 18.3% from the corresponding quarter last fiscal. EBITDA margin for the quarter stood at 29.2%

The company reported a net profit of Rs 55.1 crore for the quarter as compared to a net loss of Rs 32.32 crore in the previous quarter and a net loss of Rs 48.56 crore for the same quarter last year.

Highlights

Dish TV informed that it has added 477,000 new subscribers during the quarter ending September 30, 2012, taking the total number of gross subscribers to 13.9 million subscribers and net subscribers to 10 million.

Subscriber Acquisition Cost (SAC) stood at Rs 2,273, up from Rs 2,232 in the previous quarter (Q1-FY13). Interestingly, the company had previously noted that the subscriber acquisition cost for Q1-FY13 was Rs 2,145.

Average Revenue Per User: The annual average revenue per user (ARPU) for DishTV stood at Rs 159, up from Rs 156 in the previous quarter. The company attributed this increase partially to the price hike in the last quarter.

Subscription revenues for the quarter was at Rs 472.7 crore, up 14.6% from the same quarter last year.

According to Jawahar Goel, Managing Director, Dish TV, the second quarter has been sluggish due to the macro headwinds and price hike at the entry level, however their strategy and on ground execution allowed the company to gain new subscribers after the first month.

He also added that, despite a steady growth in its digital deployment, the on ground implementation has not been encouraging till now, although with the government’s firm indication against extending the digitization deadline in the country, the company intends to gain a reasonable uptake in its subscriber base in the future.

Talking about the company’s performance during the quarter, Goel stated that Dish TV continues to be free cash flow positive for the third consecutive quarter, although it expects an increase in its market costs during the quarter in lieu of additional marketing spends around digitization. He also added that the churn remained at 1% per month despite the increase in package price last quarter.

During the quarter, Dish TV launched a standard definition recorder called Dish+, which offers regular DVR (digital video recorder) features like recording and playing back TV programs to USB drives, pausing or rewinding live TV program, various play-back positions, event based recording (EBR), and time based recording (TBR) among others. The company had stated that Dish+ will be available in 42 Indian cities to be covered in the Phase I and Phase II of Cable TV digitization and will carry a price tag of Rs 1690.

Last month, Dish TV had also introduced a recharge option through Interbank Mobile Payments Service (IMPS) for its subscribers. The company had said that Dish TV customers can make use of this service through its mobile app, Dish TV website and Interactive voice response (IVR) with SMS support being added shortly. It had tied up with Yes Bank to offer this service.

Last week, it had also announced a free Basic Channel Tier for customers in four metros where digitization has been made mandatory by October 31, 2012. Through this initiative, Dish TV claimed to offer 70 free to air channels free of cost for life to subscribers, provided they remained active by subscribing to a regular subscription package twice during a year. The company however hasn’t disclosed the channels included in this package.

Download: Press Release | Financials