India's PVR Cinemas Posts Strong Third-Quarter Results
India's largest cinema chain sees robust earnings thanks to box office hits such as the record-breaking 'PK'.
India's largest cinema chain PVR announced robust financials for the quarter ending 31 December, the third quarter in the country's financial year. The company posted revenues of $702 million (rupees 4.21 billion), up 24 per cent on the same period in 2013. Profit after taxes reached $5.26 million (316 million rupees), up by 127 per cent, while EBITDA (earnings before interest, taxes, depreciation, and amortization) rose 63 per cent to $14 million (840 million rupees).
PVR claimed the strong results were due to solid hits including Disney-UTV Motion Pictures' record shattering PK (considered the most successful Indian film), Fox Star Studios' Bang Bang! (a Bollywood remake of the Tom Cruise-Cameron Diaz starrer Knight and Day), superstar Shah Rukh Khan's Happy New Year and director Vishal Bharadwaj's Hamlet adaptation Haider.
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The chain also reported that its admissions rose by 12 per cent to 16 million, while average ticket prices rose by five per cent against the same period last year. Food and beverage revenues showed a strong growth of 35 per cent over the previous quarter.
Headquartered in New Delhi, PVR became India's largest cinema chain when it acquired Mumbai-based rival Cinemax India in 2012, buying a majority stake for $745 million. The company now runs 462 screens across 104 properties in 44 cities. It has plans to add another 21 screens in the current quarter.
The Indian cinema business is currently going through a consolidation phase, with two major deals reported in December. Reliance group's Big Cinemas chain was acquired by South India-based Carnival Films for an undisclosed amount. Mexico's Cinepolis – the only foreign player in the market – acquired the Fun Cinemas chain for a reported figure of $77 million.
A recent unconfirmed report in business paper The Economic Times indicated that PVR was close to acquiring leading South Indian player Sathyam Cinemas. But in an interview with The Hollywood Reporter, PVR Limited CEO Ajay Bijli said, “We have not acquired anything and all reports are speculation.”
When asked if the company would seek any acquisitions going forward, Bijli said. “We have been careful about the quality and valuation of any potential asset. If we find any opportunities we will look at them closely.”