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Fourth quarterly net loss for India’s Network 18

Indian media company Network18 has reported its fourth quarterly loss in a row, citing the cost of starting four new TV channels as one of the key expenses which offset its revenue gains.

The broadcast and publishing group posted a loss of INR 85.81 crore for the three months to 31 December 2011, compared to a profit of INR 78.61 crore in the same quarter a year earlier.

Third quarter revenue rose 24% to INR 503.81 crore, however a write off of INR 37 crore by its Viacom 18 division and INR 25.3 crore attributed to the launch of AETN18 were among the costs which lead to the operating loss of INR 81.3 crore posted for the third quarter.

TV18, in which Network 18 has a 59.75% stake, reported a 45% increase in revenue to INR 342.8 crore following the launch of new channels. The unit's loss reached INR 13.76 crore in the third quarter compared to a loss of INR 1.46 crore in the same period a year ago.

"We invested in further building our television bouquet with four successful channel launches. At the beginning of the year, we also announced a transformational deal which will result in making the group debt free and expanding our regional television footprint," said Raghav Bahl, managing director, Network 18.

"Over the next few quarters, we will work towards a successful consummation of the acquisition while we continue to build and consolidate our existing businesses."

The slowing economic growth to 7% from India's earlier target of 9% is adversely affecting advertising revenue for broadcasters, while operating costs are rising. This has led to a "sluggish" period for the entire industry, says Network18's group chief executive, Sai Kumar.

The company remains upbeat about subscriber numbers, however, with subscription revenues reportedly reaching projections.

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