PVRINOX Q2 FY24 earnings call.
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Revenue
₹2,000 Cr
verified against source
Revenue YoY
87%
reported change
EBITDA
₹447 Cr
latest reported figure
Source
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record provenance
Actual signal trajectory
Where this quarter sits.
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What the record says.
PVR INOX delivered a record-breaking Q2 FY24 with 4.8 crore guests (+64% YoY) and highest-ever ATP of INR 276 (+25% YoY) and SPH of INR 136 (+15% YoY). Revenue surged 87% YoY to INR 2,020 crore, with EBITDA at INR 447 crore (22.1% margin) versus INR 16 crore in pro forma Q2 FY23. PAT of INR 207 crore compared to INR 78 crore loss year-ago. The company reduced net debt by INR 327 crore to INR 1,100 crore, targeting FCF positivity by FY24-end and 1:1 debt-to-EBITDA. Management highlighted robust content pipeline for Q3-Q4 including Tiger 3, Animal, and Sam Bahadur. Integration synergies of INR 120-140 crore realized in H1, with 200bps margin expansion expected at steady state. Key risks include ad revenue still 30% below pre-COVID per-screen levels and content concentration in a few blockbusters. South India expansion remains a priority despite pricing caps in Tamil Nadu/Telangana.
Colored figures show movement against the previous available record.
Guidance to track
- Company expects to be FCF positive after funding all CapEx for FY24, driven by EBITDA growth and working capital optimization.
- Net debt reduced by INR 327 crore in H1 to INR 1,100 crore. Management targets achieving 1x leverage this fiscal year.
- 68 screens opened in H1; remaining 82-92 screens planned for H2. Net additions of ~100 screens after 60 exits from underperforming locations.
- Absolute ad revenue expected to reach 2019-20 levels next year. Per-screen ad revenue will remain below pre-COVID due to higher screen count.
Risks flagged
- Q2 results were heavily driven by two mega-blockbusters (Jawan at INR 760 crore, Gadar 2 at INR 620 crore BO). Any quarter without comparable content could see significant earnings volatility.
- Per-screen ad revenue remains ~30% below pre-COVID levels despite absolute recovery expected next year. Advertisers have diversified to digital/TV during COVID, and rebuilding cinema's share of ad budgets is slow.
- Tamil Nadu, Andhra Pradesh, and Telangana have ticket price caps that limit ATP realization. Company cannot implement premium pricing for even blockbuster regional films like Jailer in these markets.
- Tamil Nadu and Karnataka saw 29-30% minimum wage inflation this year, compressing margins at newly opened premium properties in these key expansion markets.
Key quotes
- The quarter ended September 30, 2023, was a record-breaking quarter in company's history and highest ever ATP and SPH, leading to highest ever quarterly revenue, EBITDA and PAT.
- The biggest highlight of the quarter was the historic performance of the Hindi box office. Jawan and Gadar 2 emerged as two of the biggest grossing Hindi films of all times.
- Our focus this year is to get down to a 1:1 debt to EBITDA. But over the next couple of years, reduce that from existing levels.
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