Despite lower sales the operating profit margin (OPM) expanded by 200 bps to 20.5% and thus the fall at operating profit was restricted at 28% to Rs 71.09 crore. Expansion in OPM despite lower sales is largely due to cost optimization measures and soft newsprint prices. Further with Other income jumping 57% to Rs 3.41 crore, the PBIDT was down by 26% to Rs 74.51 crore. After accounting for higher interest and lower depreciation, the PBT was down by 39% to Rs 38.78 crore. With taxation being a provision of Rs 10.25 crore (against a write back of Rs 11.69 crore) the PAT was down by 62% to Rs 28.52 crore.

Half Yearly performance  

Consolidated sales for the period was down by 51% to Rs 556.78 crore dragged down by 59% fall in advertisement revenue to Rs 359.58 crore and 25% fall in circulation revenue to Rs 196.1 crore. But with OPM crash to 6.8% from 24.1% in corresponding previous period, the OP was down by 86% to Rs 38.04 crore. Eventually the PAT was a loss of Rs 19.53 crore compared to a profit of Rs 169.30 crore in the corresponding previous period.

Management Comment 

Commenting on the performance for Q1 FY 2020-21, Sudhir Agarwal, Managing Director, said, " We entered the first half of this financial year filled with uncertainty, brought about by the global pandemic, and while the threat is far from over, we are extremely pleased with the resilience shown by our business, employees and partners. We have been strong believers of the Indian growth story, especially the depth and strength of the non-metro cities in India. The pandemic has underscored this belief and all the markets that the Dainik Bhaskar Group operates in, primarily, Tier-II and Tier-III cities, have been returning to normalcy at a rate that is outpacing the metros. While our results are reflective of the disruption in the first quarter, it is important to note that on almost all parameters, i.e. operations, advertising revenues and circulation, we have seen phenomenal traction beginning mid-July, that has improved sequentially. With Navratri coming in late by a month this year, our advertising revenues from this season shifted from the last week of September to October. Adjusted for this, we are happy to report that our performance is now approaching near pre-Covid levels. Our profitability has been witnessing improvement on the back of our relentless cost optimization measures, soft newsprint prices. With the upcoming festive season already showing signs of an imminent revival, and given the strong work that our teams have put in the past few months, we are hopeful that we should be able to recover a large part of the performance that was lost to the pandemic."