India's UTV posts 29% profit increase
Content and gaming lead a gain of $6 milUTV Software Communications posted a 29% rise in quarterly net profit Tuesday, led by gains in television content and gaming, but its broadcast division continued to record losses, pressuring margins.
The company, with interests in broadcasting, television content, gaming and new media, reported net profit of 299 million rupees ($6.1 million) for the group, compared with $4.73 million a year ago, while net sales rose 10% to $27.6 million.
According to a poll of analysts, UTV Software's profit was expected to more than halve to $2.1 million while net sales was projected at $30.3 million rupees.
The gaming division grew by a fifth compared with the previous quarter, mainly on contribution from operations in India, a fast-growing market for mobile gaming, UTV said.
Broadcasting recorded a loss of $2.3 million while the television content division's profit remained stable.
The firm said in November that its loss in broadcasting for the third and fourth quarters of 2008-09 will not exceed $3.1 million.
It hopes to break even in fiscal first quarter of 2010-11, the company said Tuesday.
UTV Software Communications in November also consolidated operations for four television channels -- Bindass, Bindass Movies, UTV Movies and World Movies -- by phasing out its Delhi operations.
Its motion pictures division had two successful small-budget film releases -- "Oye Lucky Lucky Oye" and "Fashion" -- in the quarter.
"The growth as well as the success of our movies has not corresponded with the bottom line thus far, primarily because revenue exploitation has been back-ended and the cycle extended," company CEO Ronnie Screwvala said in the statement.
However, the company, which has invested $84 million into motion pictures, expects the benefits of a strong movie library, including Hollywood ones, to accrue in coming quarters.