Network18′s e-commerce revenues grew 19.73% quarter on quarter and 48.10% year on year to Rs 125 crore, for the three month period ended 30th December 2013 (Q3-FY14). This is a particularly key quarter for the commerce business, given the three month long festive season, spanning Diwali to Christmas, and with the opportunity of Google backed Great Online Shopping Festival for HomeShop18, and events and movie releases for BookMyShow.com. We’re not sure if Network18’s quarterly results include travel portal Yatra.com.
The commerce segment is growing for Network18: last quarter, it had crossed the Rs 100 crore mark, and this quarter has seen another substantive increase. Commerce accounts for 83% of “Digital Content and Commerce” segment revenues for Network18.
Note that we had heard from several HomeShop18 sources that the company was expected to report a profit this quarter, but that doesn’t find a mention in the financial results. We’ve written to the company for a confirmation. If this is true, it will be the first quarter in which HomeShop18 reports a profit. We haven’t yet heard back from HomeShop18 CEO Sundeep Malhotra on the role that Capital18 head Sarvbir Singh is playing at Homeshop18. The only statement we’ve got so far is “HomeShop18 continued to scale across key growth parameters while improving operating efficiencies.”
Network18 does say, however, that the operating losses for the segment increased q-o-q primarily on account of increased marketing spends at BookMyShow. Bookmyshow.com reported that the average tickets sold every month grew by 53% to 2.9 million (Q3 average) from 1.9 million last year.
BookMyShow had reported revenues of Rs 52.62 crore and a profit of Rs 3.23 crore for the year ended March 31, 2013 (FY13). HomeShop18 had reported total revenues of Rs 225.4 crore in FY13, with losses of Rs 120 crore for FY13.
Content, which accounts for around 16.5% of Network18’s Digital Content and Commerce segment revenues, reported revenues of Rs 24.8 crore, up 10.71% year on year, and 21.57% quarter on quarter. Since the quarter ended, Network18 announced new properties and changes in its content structuring: it launched regional news portals News18 and business news site FirstBiz, while also shifting Tech2 to FirstPost. As we’ve mentioned earlier, Network18’s online content strategy need a rethink.
Note that costs would have reduced substantially, and will possibly continue to be lower year on year for the content business, given the layoffs at Web18 last year.
During the quarter, In.com Shuts Down Music Streaming Service
EBITDA losses for Digital Content and Commerce segment reduced 54.95% quarter on quarter to Rs 14.1 crore from Rs 31.3 crore last fiscal and increased 51.61% quarter on quarter from Rs 9.3 crore. The segment reported revenues of Rs 149.8 crore, up 20.3% from Rs 124.8 crore last fiscal and 40.26% from Rs 106.8 crore for the same quarter last year. Total revenues for Q3-FY13 have been reported by us by excluding Newswire18 revenues of Rs 12.8 crore.
A press release from Network18 quotes its MD Raghav Bahl as saying that “Even though the macroeconomic environment continued to be uncertain, the media and entertainment industry is well poised to deliver robust growth. During the current quarter, our television operations turned in strong operating profits. We demonstrated the significant value built in our digital commerce operations which have also cut their losses substantially.”