TIDMEROS
RNS Number : 4376H
Eros International PLC
19 June 2013
EROS INTERNATIONAL PLC
PRELIMINARY RESULTS FOR THE YEAR ENDING MARCH 31, 2013
HIGHLIGHTS
2013 2012 Change
($ Million) ($ Million)
Revenue 215.3 206.5 4.3%
Revenue (constant currency) 215.3 195.4 10.2%
EBITDA 158.7 149.5 6.1%
Underlying EBITDA* 160.6 154.8 3.7%
Operating profit 55.0 61.4 (10.4%)
Underlying operating
profit* 56.9 66.7 (14.7%)
Basic EPS (cents) 22.9 31.9 (28.2%)
-- Major collaboration agreed with HBO, with launch of two
unique premium advertising free channels showcasing Hollywood and
Bollywood content launched in India.
-- 77 films released during the year (2012:77), with 2 out of
top 10 Box Office films for calendar year 2012 (Housefull 2 and Son
of Sardaar)
-- NYSE listing process underway with expectation to conclude
later this year subject to compliances and regulatory consents.
-- Net cash from operating activities up 12.8% to $139.5 million
in the year ended March 31 2013 (2012: $123.7)
Commenting on the results, Kishore Lulla, Executive Chairman,
said "I believe that the Company is well positioned to capitalise
on the opportunities presented by the rapidly growing Indian
entertainment sector and I remain very positive about the outlook
of the business. Our HBO collaboration is a game-changer for the
Company and while in the short run we anticipate continued
investment in content, we believe we will generate strong annuity
cash flows as the subscriber growth accelerates further unlocking
the value of our catalogue. We will reinforce our leadership
position, focus on our strong fundamentals such as continuing to
develop our content slate and generating strong cash flows through
monetisation across our multiple distribution channels worldwide
and anticipate accessing equity capital through the NYSE
listing".
*EBITDA is profit before depreciation of tangible assets,
amortisation of intangible assets, finance costs, other gains and
losses and income tax. Operating profit is profit before net
finance costs, other gains and losses and income tax. The
Underlying EBITDA and operating profit results add back share based
payment charges.
For further information, please contact:
Eros International Plc
Sean Hanafin
Chief Corporate & Strategy Officer
T: +44 (0)20 7258 9909
Jamie M.M. Kirkwood
Group Communications & Investor Relations
T: +44 (0)20 7258 9906
Investec Bank plc
Nominated Adviser & Joint Broker
Jeremy Ellis / Patrick Robb / Carlton Nelson
T: +44 (0) 20 7597 5000
Peel Hunt LLP
Joint broker
Richard Kauffer / Dan Harris / Andy Crossley
T: +44 (0) 20 7418 8900
About Eros International Plc
-- Eros co-produces, acquires and distributes Indian language
films, in multiple formats worldwide
-- In 2006, Eros listed its shares on the AIM Market of the
London Stock Exchange
-- In October 2010, Eros International listed its Indian
subsidiary Eros International Media on the BSE & NSE in
India
-- Eros operates in over 50 countries, with offices throughout
India, the United Kingdom, USA, UAE, Singapore, Australia, Fiji and
the Isle of Man
OPERATIONAL HIGHLIGHTS
-- Game-changing HBO Collaboration: The Eros-HBO collaboration
is one of the most significant deals the Company has entered into.
The collaboration was announced in December 2012, and two unique
premium advertising free channels showcasing Hollywood and
Bollywood content were launched in India, namely HBO Defined and
HBO Hits, in March 2013 on the Dish and Airtel DTH platforms. It is
anticipated that the channels will be live on other DTH and digital
cable platforms in India during the course of the next few months.
The early response from subscribers signals a positive outlook for
the year ahead.
-- Diversified Portfolio of Releases: Major film releases in the
period included; Housefull 2, Cocktail, Son of Sardaar, Khiladi
786,Teri Meri Kahanni, Vicky Donor and English Vinglish among the
successful Hindi releases out of the total 30 Hindi films.
Thuppakki, Maatraan and Kadal were the 3 notable Tamil releases in
the year. The Company released a total of 77 films in the year in
line with the prior financial year ended March 31, 2012. The hugely
anticipated Kochadiayan (starring Rajnikanth) as well as Go Goa
Gone (starring the Saif Ali Khan ) were postponed to the financial
year ended March 31, 2014.
-- Consistent Box Office Track Record: The notable new trend
within the growing box office in India was the higher than
anticipated success of smaller budget films along with continued
growth in high profile films with 9 films crossing the INR 100
crore box office gross collection mark in calendar year 2012 as
compared to just 5 films in the previous year. Consistent with the
Company's track record of picking winners in its portfolio, the
Company had 2 out of the Top 10 Box Office films for calendar year
2012, namely Housefull 2 and Son of Sardaar. In addition, Vicky
Donor as well as English Vinglish (which were lower budget high
concept films), were not only critically acclaimed and won several
awards but were also highly successful at the box office within
India as well as internationally.
-- Strong Television Presales: A major television syndication
deal was announced during the year with Viacom 18, which included a
mixture of library, current and forthcoming titles. Further
television licensing deals were secured with Zee TV and Star TV
during the period. Pre-sales significantly underpinned television
revenues for the year, again consistent with the Company's strategy
to operate a de-risked business model.
-- New International Markets: Internationally, we continued to
make distribution deals in new markets such as Japan, China,
Taiwan, Korea, Romania, Malaysia, Mynmar, Nigeria and other
countries. We released the 2007 hit film Om Shanti Om for the first
time theatrically in Japan and English Vinglish in South Korea.
-- Digital distribution leadership: ErosNow, our on-demand entertainment portal accessible via internet-enabled devices, went live in August 2012 with a commercial launch of www.erosnow.com. The ErosNow channel on YouTube continued to generate strong traffic and advertising revenues. ErosNow was the top ranked Indian channel on YouTube by Video Views crossing over 1.1 billion video views for over 8,500 uploaded videos. Music monetisation continued to be strong with a combination of licensing and self-distribution deals.
GROUP CEO & MANAGING DIRECTOR'S STATEMENT
I am pleased to report that Eros has seen a 10.2% increase in
revenues (increase in constant currency) and a 3.7% increase in
underlying EBITDA against a background of a 13.1% devaluation of
the Indian Rupee when comparing the financial years ending 31 March
2012 and 2013. We are delighted not only with the success of our
high profile films this year such as Housefull 2, Cocktail, Son of
Sardaar and Khiladi 786, but also the critical as well as
commercial success achieved by our lower budget movies such as
Vicky Donor and English Vinglish.
The Indian box office continues to grow as more multiplex
screens continue to be built every year and average ticket prices
continue to rise with an increasing number of films (9 films in the
calendar year ended December 31, 2012 versus 5 films in the prior
calendar year) generating a net box office collection in excess of
Rs 100 crores (approximately US $ 18.4 million) than the previous
year. Compulsory cable digitisation, supported by the government of
India, continues to fuel the demand for premium television content.
Our collaboration with HBO to launch two advertising-free premium
channels in India is a major strategic step forward for the Company
into the high growth television broadcasting industry, which is the
largest segment in the Indian media and entertainment sector.
Against the backdrop of the 141 million cable and satellite homes
in India in 2013, a rapidly growing viewing base (Source:KPMG-FICCI
2013), we are excited about the potential of the Eros-HBO
collaboration and our ability to forge new distribution channels in
order to further monetise our new film slate and unlock the value
in our content library.
Digital new media and online consumption of content continue to
show encouraging trends, be it on ErosNow on YouTube or our ErosNow
movie and music subscription service. Licensing deals around the
world across television, video or digital new media distribution
formats continue to be prolific and we are proud to be pioneering
the distribution of Indian films to new markets. South Korea and
Japan have shown encouraging trends with the first few releases in
those countries while we continue to make encouraging progress in
Latin America and China.
We have an exciting slate to look forward to in the year ending
March 31, 2014 with a mix of high profile and medium and small
budget films. One of our major releases Kochadaiyaan (Tamil)
starring Rajnikanth did not release as planned in the year ended
March 31, 2013 and will be released to take advantage of a holiday
weekend in this calendar year. With the success of the Tamil
releases such as Maatraan and Thuppaki in the year ended March 31,
2013, the Company has made a conscious strategic move to scale up
its Tamil global releases and has a strong line-up of Tamil films
this year. This is consistent with the Company's strategy to
maintain a portfolio approach and demonstrates its ability to scale
the business.
With respect to the Company's public filing dated May 2, 2012
with the United States Securities and Exchange Commission ("SEC")
in connection with its proposed listing on the NYSE, the Board
continues to believe that the listing will give the Company a
definite strategic advantage while giving access to additional
equity capital and liquidity as well as trading with a more
comparable peer group with broader analyst coverage. The Company
remains actively engaged in the listing process with its advisory
group and hopes to conclude the US listing process later this year,
subject to regulatory and other permissions and compliances.
Jyoti Deshpande
Group CEO & Managing Director
OPERATING AND FINANCIAL REVIEW
This financial review is primarily based upon the comparison of
our results for the year ended March 31, 2013 with those of the
year ended March 31, 2012. Unless otherwise stated percentage
growth relates to the percentage comparison between these two
years.
Overview
The primary geographic areas from which we derive revenue are
India, Europe and North America, with the remainder of our revenue
generated from an area that we report as the rest of world. Outside
of India, we distribute films to South Asian expatriate populations
and in countries where we release Indian films that are subtitled
or dubbed in local languages. Although we expect the portion of our
revenue attributable to India to continue to grow, we will continue
to opportunistically pursue new global distribution
opportunities.
Our one operating segment, film content, derives revenue from
three channels: theatrical, television syndication and digital and
ancillary sources. The contribution from these three distribution
channels can fluctuate year over year based on, among other things,
our mix of films and budget levels, the size of our television
syndication deals and our ability to license music in any
particular year.
Underlying Results* Reported Results
2013 2012 Change 2013 2012 Change
(in thousands, except percentage amounts)
Revenue $ 215,346 $206,474 4.3% $ 215,346 $206,474 4.3%
Gross Profit 81,344 89,430 (9.0%) 81,344 89,430 (9.0%)
EBITDA* 160,596 154,805 3.7% 158,708 149,517 6.1%
Operating
profit* 56,924 66,727 (14.7%) 55,036 61,438 (10.4%)
*EBITDA is profit before depreciation of tangible assets,
amortisation of intangible assets, finance costs, other gains and
losses and income tax. Operating profit is profit before net
finance costs, other gains and losses and income tax. The
Underlying EBITDA and operating profit results add back share based
payment charges.
We released 77 films in the year ended March 31, 2013 compared
to 77 in the year ended March 31, 2012.
Higher revenue was partially offset by the negative impact of
foreign exchange rate fluctuations, in relation to both the Indian
Rupee and Sterling against the US dollar, with the Indian Rupee
13.1% lower at March 31, 2013 than at March 31, 2012. As 62.8%
(2012: 66.3%) of our revenues arise in India our reported US
Dollars numbers continue to be impacted by the Rupee re-rating.
Revenue
Revenue was $215.3 million for the year ended March 31, 2013,
compared to $206.5 million in the year ended March 31, 2012 an
increase of $8.8 million, or 4.3%.
Revenue by customer location from India was $135.3 million in
the year ended March 31 2013, compared to $136.9 million in the
year ended March 31, 2012, a decrease of $1.6 million, or 1.2%
principally reflecting the growth in theatrical revenue offset by
the impact of foreign exchange and television sales impacted by the
HBO collaboration. Revenue from Europe was $35.1 million in the
year ended March 31, 2013, compared to $26.9 million in the year
ended March 31, 2012, an increase of $8.2 million, or 30.5%,
principally reflecting an increase in television sales and other
revenues. Revenue from North America was $12.7 million in the year
ended March 31 2013, compared to $8.4 million in the year ended
March 31, 2012, an increase of $4.3 million, or 51.2%, principally
reflecting increased digital and syndication revenues. Revenue from
Rest of World was $32.2 million in the year ended March 31, 2013,
compared to $34.3 million in the year ended March 31, 2013, a
decrease of $2.1 million, or 6.1%, principally reflecting a slight
decrease in television partially offset by revenue from
distribution in new territories.
Our total revenue growth was primarily attributable to an
increase in theatrical revenue in the year ended March 31, 2013, as
a result of our film slate releases and the continued wider screen
releases in India The revenue growth in our theatrical revenues
reflected in particular the success of our globally released
films
Cost of sales
Cost of sales increased by $17.0 million, or 14.5%, for the year
ended March 31, 2013 to the year ended March 31, 2012. The increase
was primarily due to an increase in film amortisation costs of
$15.4 million in the period, driven by an increased investment in
new release slate as well as catalogue films in the year ended
March 31, 2013 and the cumulative impact of amortisation costs
associated with our increased catalogue films. Other costs of sale,
which principally consist of advertising and print costs, increased
by $1.5 million reflecting an increase in advertising costs offset
by a reduction of print costs and associated costs as we continued
to increase globally the usage of digital prints as opposed to
physical formats.
Gross profit
Gross profit was $81.3 million in the year ended March 31, 2013,
compared to $89.4 million in the year ended March 31, 2012, a
decrease of $8.1 million, or 9.0%, driven primarily by the increase
in cost of sales, which was partially offset by an increase in
revenues. As a percentage of revenue, our gross profit margin
reduced to 37.8% from 43.3% in the years ended March 31, 2013 and
March 31, 2012.
Administrative costs
Administrative costs, including rental, legal, travel and audit
expenses, were $26.3 million in the year ended March 31, 2013,
compared to $28.0 million in the year ended March 31, 2012, a
decrease of $1.7 million, or 6.1%, which was driven by a decrease
of $3.4 million of share based payment charges compared to the year
ended March 31 2012, and $1.7 million of additional overhead. As a
percentage of revenue, administrative costs were 12.2% in the year
ended March 31, 2013, compared to 13.6% in the year ended March 31,
2012. The share based payment charges comprise the ongoing charges
arising from the Indian IPO share option scheme and the JSOP scheme
introduced in April 2012. As at March 31, 2012, costs incurred in
respect of the anticipated listing on the New York Stock Exchange,
excluding costs in relation to employees which have been taken to
the profit or loss, have been deferred and is shown with in prepaid
charges in trade and other receivables.
Underlying EBITDA
Underlying EBITDA profit was $160.6 million in the year ended
March 31, 2013, compared to $154.8 million in the year ended March
31, 2012, an increase of $5.8 million, or 3.7%, driven by the
increase in revenue, offset by an increase in cost of sales. As a
percentage of revenue, our underlying EBITDA profit margin reduced
slightly to 74.6% from 75.0% in the years ended March 31, 2013 and
March 31, 2012.
Underlying operating profit
Underlying operating profit was $56.9 million in the year ended
March 31, 2013, compared to $66.7 million in the year ended March
31, 2012, a decrease of $9.8million, or 14.7%. As a percentage of
revenue, our underlying operating profit reduced to 26.4% from
32.3% in the years ended March 31, 2013 and March 31, 2012
reflecting the changes in gross profit margin.
Net finance costs
Net finance cost in the year ended March 31, 2013 was $1.5
million, compared to $1.0 million in the year ended March 31, 2012,
a movement of $0.5 million. The change is primarily attributable to
continued investment in film slate impacting net debt levels during
the year.
Other gains and losses
Other losses in the year ended March 31, 2013 of $7.9 million
principally comprise a $5.6 million interest rate hedging charge (a
non-cash item), a net foreign exchange loss of $1.9 million and
loss on sale of assets of $0.4 million. In the prior year ended
March 31, 2012 we had a loss of $6.8 million principally arising
from a foreign exchange loss of $1.1 million, a $4.3 million
interest rate hedging charge and $1.3 million in respect of a
provision for our available-for-sale equity investments. The
foreign exchange loss in the year ended March 31, 2013 was mainly
derived from the fall of the rupee and sterling as compared to the
US dollar which impacted US dollar denominated loans in our Indian
subsidiary and sterling deposits.
Income Tax Expense
Income tax expense in the year ended March 31, 2013 was $11.9
million, compared to $10.1 million in the year ended March 31,
2012, an increase of $1.8 million, or 17.8%. Our effective tax rate
was 26.1% in the year ended March 31, 2013, compared to 18.8% in
the year ended March 31, 2012. The ongoing increases in the
effective rate reflect the increase in the amount of taxes due
within India in the year ended March 31, 2013 together with the
impact of net hedging charges which are not deductible for tax
purposes. Our income tax expense in the year ended March 31, 2013
included $7.1million of estimated current tax expense and
$4.8million of estimated deferred tax expense. The increase in tax
was also impacted by dividend distribution tax payable on the
dividend declared by our Indian subsidiary.
Earnings per share
Earnings per share ("EPS") in the year ended March 31, 2013 were
impacted by the decrease in reported profits. Basic EPS in the year
ended March 31 2013 was 22.9 cents, compared to 31.9 cents in the
year ended March 31, 2012, a decrease of 28.2%. Fully diluted EPS
in the year ended March 31, 2013 was 22.7 cents, compared to 31.4
cents in the year ended March 31, 2012, a decrease of 27.7% which
were impacted by the decrease reported profits and an increase in
the non-controlling interest in Eros International Media Limited,
partially offset by a lower dilution of the share options held by
employees
Other financial information
Our reporting currency is the U.S. dollar. Transactions in
foreign currencies are translated at the exchange rate prevailing
at the date of the transaction. Monetary assets and liabilities in
foreign currencies are translated into U.S. dollars at the exchange
rates at the applicable statement of financial position date. For
the purposes of consolidation of foreign operations, all income and
expenses are translated at the quarterly average rate of exchange
during the periods covered by the applicable statement of income
and assets and liabilities are translated at the exchange rate
prevailing on the statement of financial position date. When the
U.S. dollar strengthens against a foreign currency, the value of
our sales and expenses in that currency converted to U.S. dollars
decreases. When the U.S. dollar weakens, the value of our sales and
expenses in that currency converted to U.S. dollars increases.
Recently, there have been periods of higher volatility in the
Indian Rupee and UK Sterling as compared to U.S. dollar exchange
rate, including the years ended March 31, 2012 and March 31, 2013.
This Indian Rupee volatility is illustrated in the table below for
the periods indicated:
Indian Rupee rate to the U.S. Dollar
Period End Average (1) High Low
March 31,2012 50.87 48.01 53.71 44.00
March 31, 2013 54.29 54.30 56.09 52.74
(1) Represents the average of the exchange rates on the last day
of each month during each period presented.
This volatility in the Indian Rupee and UK Sterling as compared
to the U.S. dollar has impacted our results of operations as shown
in the table below comparing the reported results against constant
currency comparables based upon the average rate of exchange for
year ended March 31, 2013. In addition to the impact on gross
profit, the volatility during the year ended March 31, 2013 also
led to a non-cash foreign exchange loss of $2.0 million principally
on our Indian subsidiaries' foreign currency loans and sterling
deposits in other group entities in the year ended March 31, 2013
compared to a non-cash foreign exchange loss of $1.1 million in the
year ended March 31 2012 reflected in other gains and losses.
2012 Unaudited
2013 2012 Constant
Reported Reported Currency Decline
Revenue $ 215.3 $ 206.5 $ 195.4 (11.1)
Cost of sales (134.0) (117.1) (109.1) 8.0
Gross profit $ 81.3 $ 89.4 $ 86.3 (3.1)
The impact of the decline in the Rupee to the US Dollar is shown
in the above table which shows that on a constant currency basis
the gross profit for the year ended March 31, 2012 would have been
reduced by $3.1 million or 3.5%.
Sources and Uses of Cash
2013 2012
(in thousands)
Net cash from operating activities $ 139,510 $ 123,690
Net cash used in investing activities (182,328) (147,654)
Net cash from financing activities 11,471 51,756
Net cash from operating activities in the year ended March 31,
2013 was $139.5 million, compared to $123.7 million in the year
ended March 31, 2012, an increase of $15.8 million, or 12.8%,
notwithstanding an increase in income taxes and interest paid in
the year ended March 31, 2013 of $9.1 million and $4.7 million,
respectively. In addition, there was a decrease in working capital
of $5.4 million primarily due to a decrease of $13.6 million in
trade payables and an increase in trade receivables of $19.3
million in the year ended March 31, 2013 compared to a decrease of
$5.9 million in trade payables and an increase in trade receivables
of $27.7 million in the year ended March 31, 2012.
Net cash used in investing activities in the year ended March
31, 2013 was $182.3 million, compared to $147.7 million in the year
ended March 31, 2012, an increase of $34.6 million, or 23.4%,
reflecting an increase in our investment in film content in the
year ended March 31, 2013 and future years offset by proceeds from
our sale of some of the shares held in our Indian subsidiary Eros
International Media Limited. Our investment in film content in the
year ended March 31, 2013 was $186.7 million, compared to $148.7
million in the year ended March 31, 2012 an increase of $38
million, or 25.6%, reflecting ongoing investments in our film
library.
Net cash from financing activities in the year ended March 31,
2013 was a $11.5 million, compared to $51.8 million positive in the
year ended March 31, 2012, principally reflecting a $40.3 million
decline in the uptake of net borrowings offset by proceeds from the
sale of subsidiary shares. In December 2012, 2.8% of our holding in
Eros International Media Limited was sold by the "Offer For Sale"
route to meet the minimum public shareholding requirement of 25% of
Eros International Media Limited.
A registration statement relating to Eros' A Ordinary Shares has
been filed with the United States Securities and Exchange
Commission, but has not yet become effective. These securities may
not be sold nor may offers to buy be accepted prior to the time the
registration statement becomes effective. This press release shall
not constitute an offer to sell or a solicitation of an offer to
buy nor shall there be any offer or sale of these securities in any
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of such jurisdiction.
Some of the information presented in this press release and in
related comments by Eros' management contains forward-looking
statements. In some cases, these forward-looking statements are
identified by terms and phrases such as "aim," "anticipate,"
"believe," "feel," "contemplate," "intend," "estimate," "expect,"
"continue," "should," "could," "may," "plan," "project," "predict,"
"will," "future," "goal," "objective," and similar expressions and
include references to assumptions and relate to Eros' future
prospects, developments and business strategies. Similarly,
statements that describe Eros' strategies, objectives, plans or
goals and statements regarding the proposed offering and the
anticipated costs of these transactions are forward-looking
statements and are based on information available to Eros as of the
date of this press release. Forward-looking statements are subject
to risks, uncertainties and assumptions that could cause actual
results to differ materially from those contemplated by the
relevant statement. Such risks and uncertainties include a variety
of factors, some of which are beyond Eros' control, including
market conditions. Information concerning these and other factors
that could cause results to differ materially from those contained
in the forward-looking statements is contained under the caption
"Risk Factors" in Eros' Registration Statement on Form F-1 filed
with the U.S. Securities and Exchange Commission. Eros undertakes
no obligation to revise the forward-looking statements included in
herein to reflect any future events or circumstances, except as
required by law. Eros' actual results, performance or achievements
could differ materially from the results expressed in, or implied
by, these forward-looking statements.
SUMMARISED AUDITED CONSOLIDATED STATEMENTS OF FINANCIAL
POSITION
AS AT MARCH 31, 2013 AND 2012
As at March 31
2013 2012
(in thousands)
ASSETS
Non-current assets
Property, plant and
equipment $ 11,680 $ 12,622
Goodwill 1,878 1,878
Intangible assets -
trade name 14,000 14,000
Intangible assets -
content 535,304 473,092
Intangible assets -
others 2,117 1,870
Available-for-sale financial
assets 30,385 30,385
Deferred tax assets 569 407
$595,933 $ 534,254
Current assets
Inventories $ 793 $ 1,130
Trade and other receivables 91,264 78,650
Current tax receivable 962 4,937
Derivative financial
instruments - 1,573
Cash and cash equivalents 109,705 145,422
$ 202,724 $ 231,712
Total assets $ 798,657 $ 765,966
LIABILITIES
Current liabilities
Trade and other payables $ 28,979 $ 27,239
Short-term borrowings 79,902 68,527
Derivative financial
instruments - 1,538
Current tax payable 1,846 7,830
$ 110,727 $ 105,134
Non-current liabilities
Long-term borrowings $ 165,898 $ 180,768
Other Long term liabilities 357 -
Derivative financial
instruments 16,660 11,027
Deferred tax 18,839 14,789
$ 201,754 $ 206,584
Total liabilities $ 312,481 $ 311,718
EQUITY
Equity
Share capital $ 22,653 $ 21,687
Share premium 159,547 135,008
Reserves 311,315 277,989
Other components of
equity (29,432) (18,519)
JSOP Reserve (25,505) -
Equity attributable
to equity holders of
Eros International
Plc 438,578 416,165
Non controlling interest 47,598 38,083
Total equity $ 486,176 $ 454,248
Total liabilities and
equity $ 798,657 $ 765,966
.
SUMMARISED AUDITED CONSOLIDATED INCOME STATEMENTS
FOR THE YEARS ENDED MARCH 31, 2013 AND 2012
Year ended March 31
Note 2013 2012
(in thousands, except per
share amounts)
Revenue 2 $ 215,346 $ 206,474
Cost of sales (134,002) (117,044)
Gross profit 81,344 89,430
Administrative costs (26,308) (27,992)
Operating profit 55,036 61,438
Financing costs 3 (6,202) (5,697)
Finance income 3 4,733 4,688
Net finance costs 3 (1,469) (1,009)
Other gain/(losses) 4 (7,989) (6,790)
Profit before tax 45,578 53,639
Income tax expense 5 (11,913) (10,059)
Profit for the year $ 33,665 $ 43,580
Attributable to:
Owners of the Eros International
Plc. 27,107 37,406
Non-controlling interest 6,558 6,174
$ 33,665 $ 43,580
Earnings per share (cents) 6
Basic earnings per share 22.9 31.9
Diluted earnings per share 22.7 31.4
SUMMARISED AUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME
FOR THE YEARS ENDED MARCH 31, 2013 AND 2012
Year ended March 31
2013 2012
(in thousands)
Profit for the year $ 33,665 $ 43,580
Other Comprehensive Income
Items that will not be reclassified
subsequently to profit or loss
Revaluation of property 1,726 -
Items that may be reclassified
subsequently to profit or loss
Available-for-sale financial
assets
Reclassification to profit and
loss - 1,230
Gain/(loss) arising during
the year - 4,829
Exchange differences on translating
foreign operations (14,613) (30,049)
Cash flow hedges
Reclassification to profit and
loss - 4,405
Gains/(losses) arising during
the year - (3,847)
___________ ___________
(14,613) (23,432)
Total other comprehensive income
for the year $ (12,887) $ (23,432)
________________ ______________
Total comprehensive income for
the year,
net of tax $ 20,778 $ 20,148
Attributable to :
Owners of Eros International
Plc $ 16,194 $ 18,546
Non-controlling interests $ 4,584 $ 1,602
SUMMARISED AUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED MARCH 31, 2013 AND 2012
Year ended March
31,
2013 2012
(in thousands)
Cash flow from operating activities
Profit before tax $ 45,578 $ 53,639
Adjustments for:
Depreciation 1,003 1,275
Share based payment 1,888 5,289
Amortisation of intangibles 102,670 86,804
Non cash items 5,662 5,511
Net finance charge 1,469 1,009
Movement in trade and other receivables (19,275) (27,689)
Movement in inventories 254 341
Movement in trade payables 13,634 5,861
(Gain)/loss on sale of property,
plant and equipment 389 239
Cash generated from operations $ 153,272 $ 132,279
Interest paid (4,659) (4,381)
Income taxes paid (9,103) (4,208)
Net cash generated from operating
activities $139,510 $ 123,690
Cash flows from investing activities
Purchase of property, plant and equipment (86) (1,224)
Proceeds from disposal of property,
plant and equipment 88 8
Purchase of intangible film rights
and related content (186,676) (148,662)
Purchase of intangible assets others (473) (1,572)
Interest received 4,819 3,796
Net cash used in investing activities $(182,328) $(147,654)
Cash flows from financing activities
Proceeds from disposal of subsidiary
shares 9,435 -
Net proceeds from issue of share
capital by subsidiary 596 1,498
Net proceeds from issue of share
capital - 15
Dividend to non-controlling interests (770) -
Proceeds from short-term borrowings 5,516 41,132
Repayment of short-term borrowings (12,485) (21,544)
Proceeds from long-term borrowings 11,015 35,620
Repayment of long-term borrowings (1,836) (4,965)
Net cash generated from financing
activities $11,471 $ 51,756
Net increase in cash and cash equivalents (31,347) 27,792
Effects of foreign exchange rate
changes (4,370) (8,537)
Cash and cash equivalents at beginning
of year 145,422 126,167
Cash and cash equivalents at end
of year $109,705 $ 145,422
SUMMARISED AUDITED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE YEAR ENDED MARCH 31, 2013
(amounts in thousands)
Other components of equity Reserves
----------------------------------------------------- ------------------------------------------------------------ --------------------------------------------------- -------------------------------------------------------------------------------------------
Equity
Attributable
to shareholders
Share Currency Available Reverse of EROS Non
Share Premium Translation for sale Revaluation Hedging Acquisition Merger Retained JSOP International Controlling Total
Capital Account Reserve Investments reserve Reserve Reserve Reserve Earnings reserve PLC. Interest Equity
---------------- ---------------- ----------------- ----------------- ------------- ------------- ----------- ------------- ------------------ ---------------- ------------------ ----------------------------- ------------------ --------------------
Balance as of
March 31,2012 $21,687 $135,008 $(20,534) $5,802 $233 $(4,020) $(22,752) $57,766 $242,975 - $416,165 $38,083 $454,248
Profit for the
year - - - - - - - - 27,107 - 27,107 6,558 33,665
Other
comprehensive
income
/ (loss) for
the
year - - (12,208) - 1,295 - - - - - (10,913) (1,974) (12,887)
Total
comprehensive
income /(loss)
for the year - - (12,208) - 1,295 - - - 27,107 - 16,194 4,584 20,778
Issues of
shares
to wholly
owned
trust 966 24,539 - - - - - - - (25,505) - - -
Dividend paid
by a
subsidiary - - - - - - - - - - (770) (770)
Share based
compensation - - - - - - - - 1,888 - 1,888 - 1,888
Changes in
ownership
interests in
subsidiaries
that do not
result
in a loss of
control - - - - - - - 4,331 - - 4,331 5,701 10,032
- -
Balance as of
March 31,2013 $22,653 $159,547 $(32,742) $5,802 $1,528 $(4,020) $(22,752) $62,097 $271,970 $(25,505) $438,578 $47,598 $486,176
---------------- ----------------- ----------------- ------------- ------------- ----------- ------------- ------------------ ---------------- ------------------ ----------------------------- ------------------ --------------------
(
SUMMARISED AUDITED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE YEAR ENDED MARCH 31, 2012
(amounts in thousands)
Other components of equity Reserves
---------------------------------------------------------------------------------------- -------------------------------------------------
Equity
Attributable
to shareholders
Share Currency Available Reverse of EROS Non
Share Premium Translation for sale Revaluation Hedging Acquisition Merger Retained International Controlling Total
Capital Account Reserve Investments reserve Reserve Reserve Reserve Earnings PLC. Interest Equity
---------------- ----------------- ------------------ --------------------- ------------------------ ------------------- ------------ -------------- ------------------- -------------------------- ---------------------- -------------------
Balance as of
April 1, 2011 $21,349 $128,296 $102 $(1,864) $233 $(4,578) $(22,752) $63,102 $205,745 $389,633 $35,742 $425,375
Profit for the
year - - - - - - - - 37,406 37,406 6,174 43,580
Other
comprehensive
income
/ (loss) for
the
year - - (20,636) 7,666 - 558 - (6,458) - (18,860) (4,572) (23,432)
Total
comprehensive
income /(loss)
for the year - - (20,636) 7,666 - 558 - (6,458) 37,406 18,546 1,602 20,148
Issues of
shares
upon exercise
of
options by
employees 338 6,712 - - - - - - - 7,050 177 7,227
Changes in
ownership
interests in
subsidiaries
that do not
result
in a loss of
control - - - - - - - 1,122 (176) 936 562 1,498
Balance as of
March 31,2012 $21,687 $135,008 $(20,534) $5,802 $233 $(4,020) $(22,752) $57,766 $242,975 $416,165 $38,083 $454,248
---------------- ----------------- ------------------ --------------------- ------------------------ ------------------- ------------ -------------- ------------------- -------------------------- ---------------------- -------------------
Summarised Notes to the Financial Statements
1. Basis of preparation
The results for the year ended March 31, 2013 have been
extracted from the audited consolidated financial statements which
have not yet been sent to shareholders. The financial information
set out in this preliminary announcement does not constitute
statutory accounts but is derived from those accounts. While the
information in this preliminary announcement has been prepared in
accordance with International Financial Reporting Standards
endorsed by the European Union ("IFRS"), this announcement itself
does not itself contain sufficient information to comply with
IFRS.
The auditors have reported on the statutory accounts for the
year ended March 31, 2013 and their report was unqualified.
2. BUSINESS SEGMENTAL DATA
Revenues are presented based on the region of customer
location:
Year ended March 31
2013 2012
(in thousands)
Revenue by customer location
India $ 135,292 $ 136,942
Europe 35,147 26,852
North America 12,678 8,379
Rest of the world 32,229 34,301
Total Revenue $ 215,346 $ 206,474
For the year ended March 31, 2013 no customers accounted for
more than 10% of the Group's total revenues. For the year ended
March 31, 2012 an aggregator of television rights, Dhrishti
Creations Pvt. Ltd accounted for 11.8% of the Group's total
revenues and there were no other customers that accounted for more
than 10% of the Group's total revenues.
3. FINANCE CHARGES AND INCOME
Year ended March 31
2013 2012
(in thousands)
Interest on bank overdrafts and loans $ 13,720 $ 9,341
Interest on other borrowings ___________- 120
Total interest expense for financial liabilities
not classified at fair value through profit
or loss 13,720 9,461
Reclassification of gains on hedging previously
recognised in other comprehensive income - 2,223
Capitalised interest on film content (7,518) (5,987)
Total finance costs $ 6,202 $ 5,697
Less: Interest revenue
Bank Deposits (4,206) (2,355)
Held- to- maturity financial assets (527) (2,333)
Total finance income $ (4,733) $ (4,688)
Net finance costs $ 1,469 $ 1,009
4. OTHER GAINS AND LOSSES
Year ended March 31
2013 2012
(in thousands)
Loss on disposal of property, plant and equipment $ 389 $ 239
Net foreign exchange losses 1,933 1,057
Net loss on held for trading financial liabilities 5,667 4,264
Reclassification adjustment relating to available-for-sale
financial assets - 1,300
Others - (70)
$ 7,989 $ 6,790
The net loss on held for trading financial liabilities in the
year ended March 31, 2013 principally relates to derivative
instruments not designated in a hedging relationship.
5. INCOME TAX EXPENSE
Year ended March 31
2013 2012
(in thousands)
Current tax expense $ 7,102 $ 4,946
Deferred tax 4,811 5,113
Provision for income taxes $ 11,913 $ 10,059
Reconciliation of tax charge
Year ended March 31
2013 2012
(in thousands)
Profit before tax $ 45,578 $ 53,639
Income tax expense at tax rates applicable
to individual entities 9,921 9,060
Tax affect of:
Items not deductible for tax 421 451
Utilisation of tax losses - 143
Others 1,571 405
Income tax expense $ 11,913 $ 10,059
6. EARNINGS PER SHARE
Year ended March 31
----------------------------------------------------------------------------------
2013 2012
Basic Diluted Basic Diluted
(in thousands, except earnings per share and the number of
shares)
Earnings
Earnings attributable to the
equity holders of the parent $ 27,107 $ 27,107 $37,406 $ 37,406
Potential dilutive effect related
to
share based compensation scheme
in subsidiary undertaking - (226) - (507)
Adjusted earnings attributable
to equity holders of the parent $ 27,107 $ 26,881 $37,406 $ 36,899
Number of shares
Weighted average number of shares 118,316,874 118,316,874 117,227,219 117,227,219
Potential or dilutive effect
related to share based
compensation
scheme - 52,371 - 187,314
Adjusted weighted average number
of shares 118,316,874 118,369,245 117,227,219 117,414,533
Earnings per share
Earnings attributable to the
equity holders of the parent
per share (cents) 22.9 22.7 31.9 31.4
The number of options under the Joint Share Ownership Plan that
could potentially dilute basic earnings per share in the future,
but were not included in the calculation of diluted earnings per
share because they are anti-dilutive for year ended March 31 2013
was 6,000,493.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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