ZEE's Punit Goenka: We have to be frugal, make sure of buying right content at the right price
During the Q4 FY24 earnings call, ZEE's MD and CEO, Punit Goenka said that the need of the hour is to pivot to business to achieve balanced cost structure in order to achieve sustained long term growth.
On May 17, Zee Entertainment Enterprises Limited (ZEEL) reported a net profit of Rs. 13.35 crore of the quarter that ended March 2024. During the same quarter last year, ZEEL reported a loss of Rs. 196 crore. The company reported a profit of Rs. 58.5 crore in the third quarter of FY24.
The company disclosed a total income of Rs 2185.29 crore. This is an increase from Rs. 2126.35 crore that the company reported a year ago during the same period. In FY24, Zee's ad revenue was marginally down to Rs 4057.7 crore from Rs 4057.9 crore.
ZEEL’s advertising revenue was disclosed to be Rs. 1110.2 crore compared to Rs. 1005.8 crore in the fourth quarter of FY23.
“Domestic advertising revenue for the quarter grew by 10.6 percent YoY driven by the continued recovery in macro advertising environment and spending pickup by FMCG clients,” the company said in its statement.
In an earnings call, CEO and MD Punit Goenka emphasized "frugality" again after initiating a rationalization strategy in the aftermath of the Zee-Sony merger collapse. Goenka said that the need of the hour is to pivot to business to achieve balanced cost structure in order to achieve sustained long term growth: "With that backdrop we are looking at every element of the business with the lens of improving the overall performance. As a result we expect some short term aberration in digital business financial performance."
Zee's content inventory, advances and deposits declined by Rs 540 crore in FY24 driven by optimised acquisition and movie releases.
Goenka said that the company has been aggressive in buying movies and originals but "there are times in situation like today when we have to be frugal and make sure of buying right content at the right price. So, we are being very cautious in what we buy and at what price. We may slowdown buying a bit but eventually when profitably improves we will deploy capital back in ZEE5 content."
The past few month have seen ZEE cutting down the total workforce with the aim of a 15 percent reduction. Goenka has been laser-focused on cutting down cost across verticals.
During the Q4 FY24 earnings call, Goenka said, "We believe that our (OTT) platform is built to compete in the market with the best form. There can be improvements but we didn't need this level of people. We are confident that the team that remains is capable of taking the growth plans forward."
Goenka added that the last few months have been intense as they took several tough decisions "in the interest of the company": "We have streamlined a strong team across the business. In line with the lateral structure implemented by the company we have entrusted several of our talented team members with higher levels of responsibilities to encourage more cross functional collaboration, quick decision making and ideation."
ZEE saw improving advertising environment in Q4 2024, it said, as domestic advertising revenue for the quarter grew by 10.6 percent YoY driven by the continued recovery in macro advertising environment and spending pickup by FMCG clients.
