Multiplex chains PVR, Inox see some revenue pickup but remain in the red

Two publicly listed movie theatre chains—PVR and Inox Leisure—declared quarterly results on Friday, reflecting a pickup in activity albeit way behind levels in the pre-pandemic era.

The results show also that, even though key states including Maharashtra have now allowed theatres to open, it would take time for the companies to get back on track

The current quarter ending December is usually the best period for multiplexes because of various festivals and holidays that also enable movie producers to schedule their big releases during this period.

PVR stock ended 1.4% down, off the 52-week high it touched earlier this week. Inox Leisure closed 0.2% higher, falling off its one-year high earlier in the day.

PVR

PVR, the largest multiplex chain operator in the country, reported a sharp rise in revenues for the second quarter but it remained in the red even though it managed to bring down its losses.

PVR reported a consolidated net loss of Rs 153.3 crore for the July-September quarter compared with Rs 184.1 crore in the same period last year.

Consolidated revenue more than doubled to Rs 275.2 crore from Rs 110.6 crore in the year-ago period. In the pre-pandemic era, it had revenue of nearly Rs 1,000 crore in the quarter ended September 2019.

The company reported EBITDA of Rs 86.7 crore for the quarter compared with an operating loss of Rs 14 crore a year ago.

PVR’s key highlights

1) Cinema halls reopened from July 30. PVR is now permitted to operate all its screens across India and Sri Lanka.

2) But there are continuing restrictions around capacity caps, timing of operations and vaccination requirements.

3) Telangana, Rajasthan, Karnataka, Andhra Pradesh, Punjab and Gujarat have relaxed capacity restrictions.

4) PVR concluded talks with landlord partners for rental waivers or discounts in respect of about 80% of its properties and achieved savings of 75% in Q2.

5) PVR launched 13 new screens during the period in Mumbai, Gurgaon and Jamnagar. It also re-launched the revamped Priya cinema and PVR Anupam in Delhi during the quarter.

Management Speak

Ajay Bijli, Chairman and Managing Director at PVR, said the company’s priority during the quarter was reopening its cinemas with all the safety guidelines in place so that movie goers could return.

“Looking at the sharp recovery in consumer demand evidenced by box office collections of regional and Hollywood movies during the past two months we are absolutely confident that the strong content line up that is slated for release over the next few quarters will ensure that the business will bounce back sharply,” Bijli said.

Inox Leisure

Inox was hit even harder last year with operational revenue in the quarter ended September 2020 virtually disappearing at just Rs 36 lakh. It has bounced back this year, recording sales of Rs 47.4 crore last quarter.

On a sequential basis, revenue was twice the number of the quarter ended June but a far cry from July-September 2019 when it was over Rs 500 crore.

Its EBITDA loss almost doubled to Rs 60 crore in the same period and net loss widened from Rs 67.8 crore last year to Rs 87.6 crore in the three months ended September 30.

Inox added two cinemas and six screens (all in Jaipur) last quarter. It has 658 screens and is now allowed to operate with 64% occupancy across the country. The firm saw 10% occupancy rate last quarter.

The company said it has renegotiated rent for around 86% of the properties.