The Hindu Business Line : Adlabs posts net loss of Rs 51.37 cr, income up 57%

Mumbai, July 2 The Anil Ambani-promoted Adlabs Films has posted a net loss of Rs 51.37 crore for the year ending March 31, 2009, compared with net profit of Rs 47.47 crore in the nine-month period (July 2007-March 2008).

Income from operations was up 57 per cent to Rs 662 crore.

“We have scaled up our business operations significantly and most of our businesses are in investment mode which has contributed to this loss.

“In spite of these heavy investments, our revenues have doubled,” Mr Anil Arjun, Chief Executive Officer, Adlabs Films Ltd, told Business Line.

Outlook

The multiplex operator plans to add around 78 screens this fiscal, which will be funded through a combination of internal accruals and debt.

Mr Arjun expects a turnaround in the earnings this year as movie releases line up after a lull in April-June. “The first quarter this year would be under pressure because of the strike. We hope the next nine months will be better as most films are being lined up for release,” he added.

Movie releases were stalled for two months due to a deadlock between film producers and exhibitors over revenue sharing.

This ended on June 4 with multiplex owners agreeing to part with 50 per cent revenue in the first week, 42.5 per cent in the second week and 37.5 per cent in the third week to the producers.

Last week, Adlabs opened three screens in the Netherlands and is exploring more overseas opportunities. Last year, the multiplex operator added 286 screens including in Malaysia and the US. At present, it has 440 screens spread across India, the US and Malaysia.

In terms of content, Adlabs is also exploring screen operas, sports and musical concerts in its multiplexes.

The company plans to spend Rs 200 crore this year, mainly on its media business and for setting up a studio in Film City in suburban Mumbai, while a portion of the money would go into its exhibition business too.

Ticket prices

With the economic slowdown and lower footfalls, several multiplex operators had slashed ticket prices to attract a greater audience. However, Adlabs has no immediate plans to raise prices, Mr Arjun said.

“With the release of New York, the numbers have been good and we are seeing huge demand. Since releases have just started, we have to take a decision at some point or other. For the time being, we will just wait and watch,” he added.

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Adlabs posts net loss of Rs 51.37 cr, income up 57%