Jagran Prakashan Ltd.
|BSE: 532705||Sector: Media|
|NSE: JAGRAN||ISIN Code: INE199G01027|
|BSE 12:03 | 25 Feb||71.40||
|NSE 11:59 | 25 Feb||71.50||
|Mkt Cap.(Rs cr)||2,116|
|Mkt Cap.(Rs cr)||2116.30|
Jagran Prakashan Ltd. (JAGRAN) - Chairman Speech
Company chairman speech
VISION DRIVES OUR VALUE CREATION
Our country has delivered a decisive mandate in favour of the incumbent governmentwhich will ensure policy continuity that augurs well for the economy and the industry as awhole.
We have always tried to uphold the voice of the people and our various businessdivisions serve as potent vehicles of empowerment from the grassroots. Our leadership inthe print space continues to be unrivalled although admittedly the sector facedsignificant headwinds during the reporting year.
A sharp rise in newsprint costs and lack of growth in advertisement were pains that wehad to cope with as are reflected in the results. I am happy to note the industry hasrealised the importance of cover price which was increased meaningfully to pass on someimpact of increased newsprint prices. We do not support alluring readers by reducing thecover price in the interests of the industry readers themselves and other stakeholders.
However the silver lining for us was the fourth quarter of the reporting year in whichwe witnessed double-digit growth in advertisement revenue after 11 quarters. While facingthe twin blows of high newsprint costs and no growth in advertisement revenues we quicklyadjusted ourselves to the difficult environment to avoid a dent in profitability and Icompliment our teams for achieving this feat.
As numerous data points suggest print has no threat for its growth in the foreseeablefuture. Print has been facing unprecedented challenges for the past couple of years whichI believe are short term. These challenges include certain high impact macro developmentssuch as demonetisation and the introduction of GST which were tough to handle for smalland medium businessmen who contribute significantly to print advertisement revenue.
As far as GST is concerned this has been levied for the first time on the printadvertisement revenue. This levy was absorbed by advertisers despite economic headwindsbut they could not increase their advertisement spend beyond bearing the additional burdenof GST. This is one of the reasons why growth in the print advertisement revenue is notvisible in the past two financial years. In addition to the macro-economic environmentthe steep increase in newsprint prices was another blow to the industry.
Pressure on advertisement revenue and at the same time high newsprint cost wereexceptional and the industry never experienced both together.
However let the past couple of years not cloud our conviction about the industry giventhat circulation and readership both are growing. It is just a matter of time that theindustry returns to a high single-digit growth on its high base and delivers mid-teengrowth in profits. As for cash accruals they remain robust despite flattish revenuewhich makes the industry risk free.
Our leadership comes with responsibility and there is no room for complacency for us;and with progression of other media platforms we too must continue to evolve to enhanceour readers satisfaction besides being mindful of the fact that we cannot createand disseminate content without charging appropriately for the same.
Radio and digital
Our contribution from radio and digital businesses compensated for our lessprofitability in the print business.
It validates once again the Group's strategy to diversify risks through foray intoallied businesses and territories.
Our radio business reported strong growth driven by utilisations across stationsalong with improvement in yields.
I am also pleased to share that the Board of our subsidiary Music Broadcast Limited(MBL) has approved the acquisition of Reliance Broadcast Network Limited which isoperating FM radio network known as Big FM. The acquisition is subject to the approval bythe Ministry of Information and Broadcasting Government of India which we hope willapprove it in the reasonable course of time. Post-acquisition our Group will strengthenits leadership in the radio segment and benefit from the value accretion.
We witnessed sustained growth in digital assets of our print properties and expandedour bouquet by launching punjabi.jagran.com (mobile) and gujaratimidday.com in line withour belief that the driver for digital growth is going to be Indian languages goingforward.
Our www.vishvasnews.com was certified by theInternational Fact-Checking Network (IFCN) aimed at curbing the menace of fake news. Thiscertification has enhanced our ability to generate more revenues and has placed us in thecoveted group of 62 IFCN certified companies. HerZindagi is our digitaloffering to the English audience of the lifestyle/women segment.
We stay true to our philosophy of consistently rewarding our shareholders. For FY2017-18 we paid dividend of ' 3 per share (face value ' 2) aggregating to ' 107 Croresincluding dividend distribution tax and completed the share buyback of nearly ' 300Crores. For FY 2018-19 as well the Board of Directors has recommended a dividend of '3.50 per share (face value ' 2) to the Companys shareholders aggregating ' 125Crores including the dividend distribution tax to be paid post approval in the ensuingAnnual General Meeting.
The current inability of MBL to distribute funds to the shareholders does however notimpair its ability to consider interim dividend/ buyback in the remaining quarters.
The strong distribution of surplus cash of ' 775+ Crores in the last two years by theCompany to the shareholders by way of buyback and dividend even in difficult timesreaffirms our continued emphasis on prudence.
Giving back to the society
Beyond business our social initiatives are steered by Shri Puran Chandra Gupta SmarakTrust which imparts primary secondary and higher education to 11000+ students inschools and colleges of north India under the brand name Jagran. The Trusts socialdevelopment arm Pehel raises awareness on various social issues through differentplatforms like workshops and seminars health camps and roadshows.
Pehel drives the improvement of education sustainable livelihood health hygiene andsanitation. It has been actively participating in the Swachh Bharat Mission and wasacknowledged for its contribution towards the cause by our Honourable Prime Minister ShriNarendra Modi in 2018.
We are well positioned to continue working towards achieving our strategic prioritiesand focusing on delivering sustainable long-term value ably supported by all ourbusinesses such as print radio and digital.
Before I conclude on behalf of the Board and the entire leadership team I must thankall our stakeholders for their continued trust and support in our endeavour.
Dr. Mahendra Mohan Gupta
Chairman and Managing Director & Editorial Director