PVR, Inox Leisure decline up to 8% on posting losses for March quarter

Inox Leisure posted a consolidated net loss of Rs 82 crore, while PVR reported a loss of Rs 75 crore in Q4, due to lower revenues owing to the outbreak of Covid-19 in the last month of the quarter.

Shares of multiplex operators, PVR and Inox Leisure, slipped up to 8 per cent on the BSE on Tuesday after reporting weak earnings for the quarter ended March 2020 (Q4FY20), impacted by the outbreak of Covid-19 in the last month of the quarter.

Inox Leisure slipped 8 per cent to Rs 261 in early morning deals after it reported a consolidated net loss of Rs 82 crore in Q4FY20, against a net profit of Rs 48 crore in the previous year quarter. Operational revenues declined 22 per cent year-on-year (YoY) to Rs 372 crore from Rs 479 crore in the corresponding quarter of the previous fiscal.

PVR was down 5 per cent at Rs 1,106, extending its Monday’s 7 per cent loss as it reported a consolidated net loss of Rs 75 crore in the quarter under review, against a net profit of Rs 47 crore in the year-ago quarter.

Consolidated revenues were down 22 per cent YoY at Rs 662 crore as compared to Rs 846 crore during the corresponding period of last year. EBITDA (earnings before interest, taxes, depreciation, and amortisation) margin for the quarter was down 857 basis points (bps) to 28.54 per cent from 19.97 per cent in the previous year quarter.

The management said beginning March 11, 2020, the company started closing its screens in accordance with the order passed by various regulatory authorities and within a few days, most of its cinemas across the country were shut down.

Since Cinema Exhibition is the only business segment, The company is currently not generating any significant operating revenue or cash flow from operations. The company is taking stringent measures to address the situation by implementing cost reduction strategies and conserving liquidity on the balance sheet, it said.

Meanwhile, the board of directors of PVR has approved the fundraising of up to Rs 300 crore through a rights issue.

“Once cinemas are allowed to open, the company’s revenue and cash flow might remain subdued as cinemas may not be allowed to operate at normal capacity utilisation due to social distancing norms,” Motilal Oswal Securities said in results update.

Cinemas are in the third phase of the Central government’s guidelines for reopening of lockdowns. The dates of the third phase would be decided after the assessment of the situation.

At 09:33 am, PVR was trading 1.5 per cent lower at Rs 1,143, while Inox Leisure quoting 4 per cent lower at Rs 271 on the BSE, as compared to 0.24 per cent decline in the S&P BSE Sensex.