PVR-INOX faces a whopping Rs. 333.37 crore loss due to underperformance of films

PVR INOX Limited announced its audited consolidated financial results for the quarter and the 12-month period ended March 31, 2023. The quarter ending March 2023 saw the consummation of the PVR INOX merger. The Hon’ble National Company Law Tribunal (‘NCLT’), Mumbai Bench approved the 'Scheme of Amalgamation' between INOX Leisure Limited and PVR Limited on January 12, 2023, and the merger officially became effective on February 6, 2023. The merged entity was renamed 'PVR INOX Limited,' effective from April 20, 2023.

As the appointed date for the PVR INOX merger was January 1st, 23; Q4 FY’23 results for the company are reported on a merged basis for PVR and INOX and are not comparable with Q4 FY’22 reported results. Similarly, FY’23 full year results are based on 9 month numbers for PVR and 4th quarter numbers for PVR & INOX combined making them not comparable with FY’22 reported results.

For the quarter ended March 31, 2023, Consolidated Revenue, EBITDA and PAT was Rs 11,649 mn, Rs 2,856 mn and Rs (3,340) mn respectively as compared to Rs 5,787 mn, Rs 1,423 mn and Rs (1,055) mn for the corresponding quarter in FY’22. After adjusting for the impact of IND-AS 116 - Leases, Consolidated Revenue, EBITDA, and PAT of the Company was Rs 11,647 mn, Rs 269 mn and Rs (2,857) mn respectively as compared to Rs 5,526 mn, Rs (178) mn and Rs (956) mn for the corresponding quarter in FY’22.

For the 12 months ended March 31, 2023, Consolidated Revenue, EBITDA and PAT was Rs 38,297 mn, Rs 11,268 mn and Rs (3,364) mn respectively as compared to Rs 16,555 mn, Rs 4,315 mn and Rs (4,885) mn for the corresponding period in FY’22. After adjusting for the impact of IND-AS 116 - Leases, Consolidated Revenue, EBITDA, and PAT of the Company was Rs 38,190 mn, Rs 3,886 mn and Rs (2,429) mn respectively as compared to Rs 14,071 mn, Rs (1,553) mn and Rs (4,189) mn for the corresponding period in FY’22.

The quarter witnessed a soaring start with the resounding success of Pathaan in January and the continued impressive performance of Avatar: Way of Water, which was released in Dec'22. However, February and March saw a dip in admissions due to lacklustre performances from Hindi films. While movies like Tu Jhoothi Main Makkaar and Bholaa from Bollywood were able to generate average box office collections, Selfiee and Shehzada failed to create an impact. In the case of Hollywood releases, John Wick: Chapter 4, Antman and the Wasp: Quantumania, Shazam: Fury of the Gods and Creed III delivered decent performances at the Box Office. On the other hand, regional films such as Varisu in Tamil, Waltair Veerayya and Thunivu in Telugu, and Ved in Marathi have continued to achieve significant box office collections.

Over the course of FY’23, our company has witnessed a robust recovery despite the underperformance and volatility of Hindi movies and significantly low releases from Hollywood in the previous year. The exhibition business has witnessed strong growth, driven by the exceptional performance of regional cinema, an increase in ticket prices, and a substantial increase in consumption/spending of F&B by our patrons. While there has been some volatility at the box office over the past few months, they are confident that this trend will settle down over the next two to three quarters.

Looking forward to FY’24, we are optimistic about the robust content lineup across all languages. The upcoming release slate includes several highly anticipated Hindi movies such as Maidaan, Adipurush, and Satyaprem Ki Katha in June; Rocky Aur Rani Ki Prem Kahani starring Ranveer Singh and Alia Bhatt in July; Dream Girl 2 starring Ayushmaan Khurrana and Animal starring Ranbir Kapoor in August; Jawan starring Shah Rukh Khan and Yodha starring Sidharth Malhotra in September; and Tiger 3 starring Salman Khan in November.

They are equally excited about upcoming Hollywood releases, including Fast and Furious 10 in May, Transformers: Rise of the Beasts, The Flash, and Indiana Jones & the Dial of Destiny in June, and Mission Impossible: Dead Reckoning Part 1 and Oppenheimer in July, among others. From the regional genre, we have Carry on Jatta in June, Maveeran in July, Jailer starring Rajinikanth and Bhola Shankar starring Chiranjeevi in August, and Viduthalai Part 2 starring Vijay Sethupathi and Salaar starring Prabhas in Sep’23, among others.

In the previous fiscal year, PVR & INOX launched 168 new screens in 30 cinemas, and PVR-INOX plan to open 150-175 more screens in FY'24. Most of these screens are in different stages of fit-out. The company as a strategy has also realigned all upcoming handovers of new sites for fit-outs to the next calendar year till the time there is a strong recovery in the box office. As of date their screen portfolio (including 38 management screens) stands at 1,689 screens across 361 cinemas in 115 cities in India and Sri Lanka.

Commenting on the results and performance, Mr Ajay Bijli, Managing Director, PVR INOX Ltd said, “The year gone by marks the 1st full year of uninhibited operations for the exhibition industry. There was considerable volatility in box office quarter on quarter. We believe that the 2 major factors that marred the industry in FY’23 –the underperformance of Hindi films and less number of Hollywood releases, will both ease out in FY’24. The recently culminated merger with INOX will act as a key milestone for the company and the Indian film industry as a whole. The integration process is proceeding smoothly and we are confident of achieving operational synergies of INR 225 crs over the next 12-24 months.” ALSO READ: PVR MD Ajay Bijli assures that ticket prices will come down in several theatres after the Inox merger: “Our focus is more on getting more and more people inside, rather than looking at ticket price”

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