Broadcaster NDTV Ltd posted a net loss of Rs44.74 crore for the quarter ended 31 March, swinging from a profit of Rs3.31 crore during the year ago period, on significant non-recurring costs and falling ad revenues. For the fiscal ended 31 March, the company posted losses of Rs73.18 crore, compared with a profit of Rs4.28 crore during the year-ago period. This includes non-recurring costs of Rs40.45 crore, the company said in a statement.

NDTV’s consolidated figures (including NDTV Networks, Imagine, Lifestyle) took a pounding on the cash burn of the general entertainment channel NDTV Imagine. Net loss for the fourth quarter widened 23% year-on-year to Rs143.47 crore, while for the reporting fiscal, the company posted net profit of Rs143 crore, compared with losses of Rs188.58 crore for the year-ago period. The profit is however, on the strength of a one-time gain from the stake dilution in NDTV Networks Plc., to NBC Universal (NYSE: GE), to the tune of Rs642 crore, so if you discount that from the bottom line, the company incurred net losses of Rs499 crore for the year. 

We spoke with NDTV Group CEO K.V.L. Narayan Rao to get an accurate picture of where the company stands and the way forward. Following is a summary of what he said.

On cost cutting: Management and staff have taken salary cuts and there will be no increments this year. The company has taken a decision to rightsize manpower by 20%.  All these will result in savings of Rs20 crore on manpower costs alone. The company has cut costs aggressively on all fronts operationally and has also renegotiated contracts wherever possible. This process will continue through the year.

On non-recurring costs: While these are not treated as exceptional items, in our view, these are one-time, non-recurring costs, spread across different heads. These include severence pay resulting from staff downsizing, one time incentive cost incurred earlier that are being booked now, fixed assets impairment and assorted writeoffs.

On Revenues: Even though total income has grown marginally, ad revenues actually dropped 19%. Subscription revenue grew 43%.

On distribution costs: “We have been very very tight on distribution”. In some cases, it has affected the visibility of the channels, but we are constantly reconfiguring the reach to optimize returns from distribution spends.

On NDTV Imagine: The channel has consolidated at No.4, with 90 GRPs and growing. Some of the new shows are gaining traction. Entertainment is an expensive business to set up. So while Imagine had been on air only for two months prior to last fiscal’s reporting, these results capture the impact of running the channel for the full year.

Going forward: “The economic downturn has impacted all of us and while we made all efforts to cut costs once the gravity of the slowdown became evident towards the end of second quarter, many things cannot be scaled back over night and despite our best efforts, it only partially offset the drop in revenue. Our revenue expectations reflect growth but are more realistic and achievable now, we have several innovative schemes in place and we have driven operational efficiencies wherever possible. What comes as great comfort is the fact that we have a solid cash reserve that will be of great help in tiding over this difficult phase.”