Movie-going behavior is not stopped by consumption slowdown according to PVR’s Nitin Sood

PVR’s Nitin Sood – Image Credits – Fortune India

The earnings for the second quarter have been quite strong according to PVR. There is a 37.3% increase in the revenue for year-on-year in this quarter and there is an increase of 35% in the net profit. The margin for EBITDA was at 32.7% as against 17.5% for the last fiscal year in the same quarter.

Going through the details of the outlook and the performance, the CFO for PVR, Nitin Sood said that this year has been great for the box office; the movie performance has been very good along with an exceptional Q2. Things look good for the current quarter also.

PVR is looking ahead for good back to back H1 and H2 as told by Sood when he was giving an interview for CNBC-TV 18.

According to him, the operating margins for the first part of the year have been robust and the margins for the EBITDA quarter are adjusted to 20% for IND AS 116, which is among the best margins that have been registered by the company.

According to the pipeline of movies, the opening in the month of October has been fantastic with films like WAR and with big films coming up like Housefull 4 which is slated for a Diwali release in the month of November that includes films like Frozen 2 and Dabaang 3 in the month of December along with other big films and so it has got a strong movie pipeline.

Footfalls are strong

The behavior of people going to movies is not impacted by the slowdown in consumption at all and it was reflected because the cinemas had strong footfall and the spending was also strong on F&B according to him.

In Q2, the average occupancy was 36.5%. In this quarter, the addition in overall footfall is 25% which includes the cinema circuit of SPI that has been bought last year. Footfall growth has been very strong. According to Sood, admissions in the range of 2.93 crores has been made this year.

Considering the revenues in advertising, the challenge was the general environment and strong growth of 16% has been managed by our team as per the ad revenue about this quarter. Sustained growth in ad revenue has been managed by moving into partnerships with advertising clients who are there on a long-term basis.

According to him, no shares have been sold by promoters and added that SPI Cinemas was just merged. 29% of equity on SPI was held by SPI Cinemas former promoters and when it was merged they got the PVR shares. It made the PVR Cinemas shareholders diluted to the degree of 3.2 % this is the only reason why promoter holding has been reduced.

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