Eros International Plc Reports Third Quarter FY 2019 Results
Eros International PLC (NYSE:EROS) (“Eros”), a Global Indian
Entertainment Company, today announced unaudited financial results for
the three and nine months ended December 31, 2018.
|
Dec’18 |
Sept’18 |
June’18 |
Mar’18 |
Dec ‘17 |
||||||||||||
| (USD in millions) | Q3 FY19 | Q2 FY19 | Q1 FY19 |
Q4 FY18 |
Q3 FY18 | |||||||||||
| Gross Revenue (1) | $86.6 | $72.2 | $66.6 | $71.8 | $67.5 | |||||||||||
| Reported Revenue | 76.7 | 63.4 | 60.2 | 71.9 | 65.2 | |||||||||||
| Y/Y % Growth | 17.6% | 0.2% | -1.0% | 36.4% | 13.8% | |||||||||||
| Q/Q % Growth | 21.0% | 5.3% |
-16.3% |
10.3% | 3.0% | |||||||||||
| Operating Profit | 13.2 | 8.4 | 10.4 | 20.3 | 15.1 | |||||||||||
| Operating Profit Margin | 17.2% | 13.3% | 17.3% | 28.2% | 23.2% | |||||||||||
| Adjusted EBITDA (1) | 31.4 | 24.8 | 25.6 |
24.1 |
25.9 |
|||||||||||
| Adjusted EBITDA Margin | 40.9% | 39.1% | 42.5% |
33.5% |
39.7% |
|||||||||||
| Global Paid EN Memberships | 15.9 | 13.0 | 10.1 | 7.9 | 5.0 | |||||||||||
| Y/Y Growth | 218.0% | 251.4% | 248.3% | 276.2% | 150.0% | |||||||||||
| Q/Q Growth | 22.3% | 28.7% | 27.8% | 58.0% | 35.1% | |||||||||||
| Global EN Registered Users | 142 | 128 | 113 | 100 | 80 | |||||||||||
| Paid / Registered Users | 11.20% | 10.16% | 8.94% | 7.90% | 6.25% | |||||||||||
| Films Released | 25 | 17 | 14 | 8 | 4 | |||||||||||
| Cash | $134.9 | $134.9 | $86.1 | $87.8 | $134.6 | |||||||||||
| Gross Debt | 294.0 | 297.0 | 272.9 | 276.9 | 284.9 | |||||||||||
| Net Debt | 159.1 | 162.1 | 186.8 | 189.1 | 150.3 |
| (1) |
A reconciliation of the non-GAAP financial measures discussed within this release to our IFRS revenue and net income is included at the end of this release. See also “Non-GAAP Financial Measures”. |
Eros Executive Chairman and CEO Kishore Lulla commented:
“We grew quarterly revenue 21.0% over last quarter and expanded our
Adjusted EBITDA margin to 40.9%. Our foresight into creating a
diversified slate, both linguistically and by budget, helped deliver
strong television sales as well as theatrical and digital results. Our
Eros Now OTT platform has continued to grow rapidly and reached 15.9
million paid monthly subscribers as of December 31, 2018, a 22.3%
increase over last quarter. We have achieved our previously announced
year-end target of 16 million paying subscribers in just nine months.
This tremendous achievement in a relatively short period of time
demonstrates that we are well on our way to achieving 50 million paying
subscribers in the next three years. Our balance sheet remains
conservative and we are well-capitalised, with net debt of $159.1
million, a decrease versus the second quarter of FY 2019.
Q3 FY 2019 Results
We achieved our strongest quarterly revenue performance in more than two
years, $86.6 million in gross revenue and $76.7 million in reported
revenue after the impact of IFRS 9 and 15. The growth was fuelled
primarily by Eros Now and by $41.1 million in revenue across theatrical
and television businesses. Our digital & ancillary business generated
$35.6 million in revenue, a growth of 31.4% over last quarter, and
represented 46.4% of our total revenue this quarter – the largest
proportion ever. Eros Now achieved 15.9 million paid subscribers this
quarter, which represents growth of 218% year-over-year, and registered
users grew to more than 142 million, a 78% increase versus the prior
year period.
Eros is currently at an inflection point transforming itself into a
holistic content and digital ecosystem. As we continue to undergo this
shift we expect the skew of digital and ancillary revenues to increase
relative to our traditional theatrical and TV syndication businesses.
The shift to digital will increase the visibility of our earnings as we
move towards a more annuity-type business model – higher quality of
earnings and more sustainable growth.
Content
As we look ahead to Fiscal Year 2020, we believe we have a strong film
slate, which includes Saif Ali Khan starrer ‘Kaptan’, the
trilingual remake of ‘Haathi mere Saathi’, ‘Kaamiyab’, ‘Ticket
to Bollywood’, and a host of regional releases. In addition, we have
a host of remarkable originals such as ‘Dashavtar’, ‘Ponnyin
Selvan’, ‘Flesh’, ‘Bhumi’ coming up on ErosNow that we
look forward to releasing in the upcoming quarters.
The theatrical slate this quarter included the critically acclaimed ‘Tumbbad’,
‘Boyz 2’ (Marathi), ‘Mumbai Pune Mumbai 3 (Marathi)’, Andhadhun’
(Hindi), ‘Helicopter Eela’ (Hindi) and ‘Namaste England’
(Hindi) and our twin Telugu releases ‘Amar Akbar Anthony’ and ‘Savyasachi’
amongst others. Over the last nine months we have released 56 films and
four digital series and are on track for our strongest year in terms of
output. Consistent with our strategy to create compelling premium
content within a controlled budget, we had 25 releases this quarter
which spanned genres and budgets. Our two December 2018 Eros Now digital
premieres of our theatrical releases in an exclusive post-theatrical
first window, ‘Happy Phir Bhagjayegi’ and ‘Manmarziyan’,
drove an average 75 minutes of session time, which is materially higher
than the industry average of 30-50 minutes across Indian OTT platforms
in 2018. To put that in context, the average session time on YouTube is
between 8-12 minutes.
Over the past nine months we have digitally-premiered a total of 46
movies on Eros Now. This quarter Eros Now successfully premiered 19
movies across seven Indian languages: Hindi, Marathi, Malayalam,
Assamesse, Gujarati, Bengali and Kannada.
| Eros Now Q3 FY19 Premieres | ||||
| Film Title | Language | |||
| Dr. Tatya Lahane - Angaar..Power is within | Marathi | |||
| Alifa | Bengali | |||
| Kulfi | Kannada | |||
| Dharasnan | Bengali | |||
| Khajoor Pe Atke | Hindi | |||
| Paippin Chuvattile Pranayam | Malayalam | |||
| Baban | Marathi | |||
| Oskar | Bengali | |||
| Mijaaj | Gujarati | |||
| Barayan | Marathi | |||
| Preethiya Raayabhari | Kannada | |||
| Ottamuri Velicham | Malayalam | |||
| Shobdo Kolpo Droom | Bengali | |||
| Kaya: The Mystery Unfolds | Bengali | |||
| Happy Phirr Bhag Jayegi | Hindi | |||
| Manmarziyaan | Hindi | |||
| Yogi Duniya | Kannada | |||
| Othello | Assamese | |||
| Pornomochi | Bengali | |||
Our focused approach of choosing a balanced content slate spanning
genres, languages and budgets, continues to deliver positive results and
contributes to our growing high-quality library. Our TV syndication
business thrived on the back of a strong theatrical release slate and
growing global demand for film content in the analogue and PayTV
windows. We currently have TV syndication content deals in place with
over 30 international broadcasters and digital platforms around the
world including the US, Asia, Europe and the Middle East. This is a
testament to the continued demand for quality content amongst Indian
PayTV platforms, as well as to the quality of our library catalogue and
theatrical releases. In December, we announced that we had executed
several significant long-term television syndication deals with leading
TV networks around the world. The deal encompasses over 60 catalogue
films from Eros’ vast library syndicated across global broadcast
companies including Viacom – Colors in India, SABC in South Africa, E
Vision in the UAE and Tanzania TV, among others.
We have grown our digital catalogue on the Eros Now Platform to over
12,000 movies across 10 Indian languages and counting. This quarter, we
released one film or digital premiere on Eros Now weekly, added 165
music videos and 445 movie titles.
The launch of our digital series, comprising a broad mix of genres
ranging from comedy to horror and crime thriller has proved successful.
Eros Now originals are gaining critical acclaim. We won over ten awards
for our originals ‘Side Hero’ and ‘Smoke’ across various
platforms. These shows were a first step towards driving ‘Binge
Watching’ habits on the platform, which resulted in a 25% increase in
average subscriber session time. In addition, our series ‘Smoke’
has also recently been nominated at SXSW under the ‘Title Design’
category. Fellow nominees also include Black Panther, Aquaman,
Deadpool 2 and Mowgli. We launched our latest Eros Now
original series, Operation Cobra, last week – a slick,
action-packed spy thriller set in the UK.
We also recently launched Eros Now Quickie, an innovative platform for
high quality short form original content. We have now launched ten
original Quickie episodics including, ‘Date Gone Wrong’ and the
fun-series ‘Paisa Fek Tamasha Dekh’ as well as over 26
‘mini-movie’ premieres. We are planning to release at least four pieces
of short-form content each month on the platform. Engagement data has
been very encouraging from consumers - across Quickie content we have a
75% retention rate from episode to episode.
We have a very compelling upcoming slate of Eros Now originals, below
are some of the highlights of our pipeline:
-
Dashavatar with Anirudh Pathak:
(Target release: February 2019) -
Ponnyin Selvin with Krish
Jagarlamudi: (Target release: March 2019) -
Flip with Bejoy Nambiar (Target
release: March 2019) -
Flesh with Siddharth Anand:
(Target release: March 2019) -
Mrityulok with Zeishan Qadri:
(Target release: March 2019) -
Bhumi with Pavan Kripilani:
(Target release: April 2019) -
Crisis with Nikhil Advani and
Gaurav Chawla: (Target release: May 2019) -
Sanyasi Raja with Prakash Jha:
(Target release: June 2019) -
Kurukshetra: (Target release:
TBD) -
Blue Oak Academy: (Target
release: June 2019)
The music ecosystem in India has been growing exponentially over the
past few years. In India there are currently over 100 million digital
audio streaming users, a number which is growing rapidly. Music is
integral to our films and our premium content offering to consumers.
Film music is often marketed and monetized separate from the underlying
film, both before and after release. Our deep music library comprises a
key component to our unique Eros Now offering, being the only app
combining both video and music entertainment. Our music content also
represents significant value in the form of intellectual property
rights, the value of which is set to grow over time.
Music is a key focus area for us going forward as well as a vital
component of the content ecosystem. This quarter we released 11 original
singles and signed five artists. Over the next three years we envision
having over 60 artists signed and releasing original music daily.
Product, Technology and Partnerships
Refining and creating a unique and seamless product for our 140 million
plus registered user base is at the core of what we do. We continually
test and tweak across the 150 countries we are present to test not only
new features, but also new distribution models.
This quarter Eros Now entered into a strategic partnership with the
Indian telecommunications operator BSNL. A first for an Indian
telecommunications operator, the Eros Now service will be bundled in
price and sold as a stand alone service with the telecommunications
operator’s post paid and pre paid subscription price. We are excited
about this partnership and the strong prospective subscriber growth
expected. International Distribution also got a boost with the launch of
Celcom and Etisalat partnerships in the third quarter, as well as
closure of large deals in the UK and Africa. Importantly, we witnessed
3X growth in Eros Now Users on Amazon Fire TV and Amazon Channels in the
US and UK. Next quarter will be an exciting quarter as we open out some
new and non-traditional markets for Eros Now and a continued focus on
distribution in China.
Large themes for product strategy going forward will be based on
improved modalities around consumer payment and loyalty, improving
search and recommendation, launch of the linear product feature on Eros
Now, new video player with custom features and localization development
for the service. We continue to work with our product partners to focus
on “deep integrating” the Eros Now service across major large screen and
small screen partners across the world.
Competition and Outlook
The shift to streaming is accelerating at a rapid pace globally – India
is no exception. Media and OTT players everywhere are in land-grab
phase. The digital opportunity in India is enormous and we believe we
are well-positioned to achieve a meaningful share of the total
addressable market. A recent Morgan Stanely research report1
made the case for the competitive advantages of OTT platforms with
scaled, global consumer relationships and unique compelling IP. The same
report highlighted Eros Now as being the fourth largest OTT platform
globally – behind only Netflix, Amazon and Hulu. We have the largest
movie library with over 12,000 titles, a growing stable of short form
digital content through our flagship Quickie platform and a growing
music library. Our goal is to reach a total paid subscriber base of over
50 million subscribers, including at least 10 million B2C
(direct-to-consumer) subscribers, within three years. Over the same
period we expect the mix of domestic paying subscribers versus
international paying subscribers to be approximately 80/20.
Indian language content remains the main driver of video consumption
across the digital ecosystem, it is estimated that only 7% of digital
content is English language. Our large diversified library gives us
significant competitive advantage compared to our peers. Our output of
new originals and digital premieres is larger than any other OTT player
in India – including international and domestic players. Eros Now is
also unique in that we are the only service that offers a combined music
and video entertainment experience. With our aim to release an original
track daily and the continuous increase of our library supplemented by
the studio business, we believe there is a market opportunity ready to
be taken.
Our recent BSNL deal and international strategy are one of the primary
steps to achieve 50 million subscribers over the next three years as
well as deepening relationships with key partners such as Roku, Amazon
devices and channels etc. We have a strong track record and leading box
office market share in our theatrical business. China continues to be
focus area for our business and we are making inroads. Our recent
partnership with iQiyi allowed us to expand our footprint into the
fast-growing Chinese market with one of the largest online video sites
in the world. We are also progressing with multiple distribution deals
for the theatrical exploitation of some of our content in China. With
our deep talent relationships, data learnings and premiere writers room
we are confident in creating groundbreaking, cinematically acclaimed
content across a financially and linguistically diversified slate. Over
the past 10 years Eros has been responsible for 36 out of the top 110
highest grossing box office films in India.
We have always believed in being at the forefront of technology when it
comes to delivering content to our 1.6 billion plus audiences in India
and around the world. With an eye for content and deep user
understandings we are excited for the realm of possibilities that lay
ahead for video content consumption. We strongly believe that the
quality of content should mirror the levels of sophistication and
engagement from the user. Beyond our current efforts in content creation
we are exploring an alternative reality to create the ultimate user
experience. The Eros Now Extended Reality experience will drive deep
connected engagement from our audiences where the lines between the real
world and the simulated world can be blurred. This will be an ultimate
immersive premium content experience.”
1 Morgan Stanley. Swinburne, B. (January 24, 2019) 2019
Outlook – The World Pivots to Streaming.
Eros International Plc Financial Highlights :
|
Three Months Ended December 31 |
Nine Months Ended December 31 |
|||||||||||||||||||||||
| (dollars in millions) | 2018 | 2017 | % change | 2018 | 2017 | % change | ||||||||||||||||||
| Revenue | $ | 76.7 | $ | 65.2 | 17.6% | $ | 200.4 | $ | 189.3 | 5.9% | ||||||||||||||
| Gross profit | 32.3 | 34.7 |
(6.9)% |
|
81.2 | 88.7 |
(8.5)% |
|
||||||||||||||||
| Operating profit | 13.2 | 15.1 |
(12.6)% |
|
32 | 38.2 |
(16.2)% |
|
||||||||||||||||
| Gross Revenue (1) | 86.6 | 67.5 | 28.3% | 225.6 | 193.7 | 16.5% | ||||||||||||||||||
| Adjusted EBITDA(1) | $ | 31.4 | $ | 25.9 | 21.2% | $ | 81.9 | $ | 58.9 | 39.0% | ||||||||||||||
| (1) |
A reconciliation of the non-GAAP financial measures discussed within this release to our IFRS revenue and net income is included at the end of this release. See also “Non-GAAP Financial Measures”. |
Financial Results for the Three and Nine Months Ended December 31,
2018
Revenue
In the three months ended December 31, 2018, the Eros film slate was
comprised of 25 films, of which two were medium budget and 23 were low
budget as compared to four films in the three months ended December 31,
2017, of which all were low budget films. In addition, Eros Now released
three original series titled Smoke, Date Gone Wrong and Paisa Fek
Tamasha Dekh during the three months ended December 31, 2018.
In the three months ended December 31, 2018, the Company’s slate of 25
films comprised of six Hindi films, 17 regional films and two
Tamil/Telugu as compared to the same period last year where its slate of
four films comprised three Hindi films and one regional film.
In the nine months ended December 31, 2018, the Eros film slate was
comprised of 56 films of which seven were medium budget and 49 were low
budget films as compared to 16 films in the nine months ended December
31, 2017, of which one film was high budget, three were medium budget
and twelve were low budget. In addition, Eros Now released four original
series titled Side Hero, Smoke, Date Gone Wrong and Paisa Fek Tamasha
Dekh during the nine months ended December 31, 2018
In the nine months ended December 31, 2018, the Company’s slate of 56
films comprised of 14 Hindi films, five Tamil/Telugu film and 37
regional films as compared to the same period last year where its slate
of 16 films comprised of eight Hindi films, one Tamil/Telugu films and
seven regional films.
| Three months ended | High | Medium | Low | Total | |||||||||
| December 31, 2018 | 0 | 2 | 23 | 25 | |||||||||
| December 31, 2017 | 0 | 0 | 4 | 4 |
| Nine months ended | High | Medium | Low | Total | |||||||||
| December 31, 2018 | 0 | 7 | 49 | 56 | |||||||||
| December 31, 2017 | 1 | 3 | 12 | 16 |
Gross revenue for three and nine months ended December 31, 2018,
respectively are $86.6 million and $225.6 million compared to $67.5
million and $193.7 million for the three and nine months ended December
31, 2017, respectively. Gross revenue for the three and nine months
ended December 31, 2018, respectively, have been adjusted towards
significant financing component on account of adoption of new accounting
pronouncements.
Accordingly, the Company’s reported revenue for three and nine months
ended December 31, 2018 are $76.7 million and $200.4 million,
respectively, compared to $65.2 million and $189.3 million for the three
and nine months ended December 31, 2017, respectively. Adjustments to
reported revenues upon adoption of new accounting pronouncements for
three and nine months ended December 31, 2018 are as below.
| Three months ended December 31, | Nine months ended December 31, | ||||||||||||||
| 2018 | 2017 | 2018 | 2017 | ||||||||||||
| (in millions) | |||||||||||||||
| Revenue (GAAP) | $ | 76.7 | $ | 65.2 | $ | 200.4 | $ | 189.3 | |||||||
| Adjustment towards significant financing component | 9.9 | 2.3 | 25.2 | 4.4 | |||||||||||
| Gross Revenue (Non-GAAP) | $ | 86.6 | $ | 67.5 | $ | 225.6 | $ | 193.7 | |||||||
For the three months ended December 31, 2018, aggregate theatrical
revenues increased by 69% to $21.8 million from $12.9 million for the
three months ended December 31, 2017 and in the nine months ended
December 31, 2018, revenue decreased by 0.7% to $55.5 million, compared
to $55.9 million for the nine months ended December 31, 2017. The
variation in theatrical revenue is primarily due to mix of films.
For the three months ended December 31, 2018, aggregate revenues from
television syndication decreased by 34.4% to $19.3 million from $29.4
million for the three months ended December 31, 2017 and in the nine
months ended December 31, 2018, revenue decreased by 20.7% to $55.5
million, compared to $70.0 million for the nine months ended December
31, 2017. The decrease is mainly due to lower catalogue sales during the
period.
For the three months ended December 31, 2018, the aggregate revenues
from digital and ancillary increased by 55.5% to $35.6 million from
$22.9 million for the three months ended December 31, 2017 and in the
nine months ended December 31, 2018, revenue increased by 41.0% to $89.4
million, compared to $63.4 million for the nine months ended December
31, 2017. The increase in revenue is primarily on account of
contribution from catalogue revenues and digital business.
Revenue from India increased by 27.4% to $28.4 million in the three
months ended December 31, 2018, compared to $22.3 million in the three
months ended December 31, 2018 and in the nine months ended December 31,
2018, revenue from India increased by 3.8% to $75.8 million, compared to
$73.0 million for the nine months ended December 31, 2018. The variation
is due to mix of films.
Revenue from Europe increased by 141.2% to $12.3 million in the three
months ended December 31, 2018, compared to $5.1 million in the three
months ended December 31, 2017 and in the nine months ended December 31,
2018, revenue from Europe increased by 118.8% to $43.1 million, compared
to $19.7 million for the nine months ended December 31, 2017. This was
due to higher contribution from the monetization of catalogue films.
Revenue from North America increased by 700.0% to $0.8 million in the
three months ended December 31, 2018, compared to $0.1 million in the
three months ended December 31, 2017 and in the nine months ended
December 31, 2018, revenue from North America increased by 114.3% to
$1.5 million, compared to $0.7 million for the nine months ended
December 31, 2017.
Revenue from the rest of the world decreased by 6.64% to $35.2 million
in the three months ended December 31, 2018, compared to $37.7 million
in the three months ended December 31, 2017 and in the nine months ended
December 31, 2018, revenue from rest of world decreased by 16.6% to
$80.0 million, compared to $95.9 million for the nine months ended
December 31, 2017. This was due to lower catalogue sales during the
period.
Cost of sales
For the three months ended December 31, 2018, cost of sales increased by
45.9% to $44.5 million compared to $30.5 million in the three months
ended December 31, 2017 and in the nine months ended December 31, 2018,
cost of sales increased by 18.4% to $119.1 million, compared to $100.6
million for the nine months ended December 31, 2017. The increase was
mainly due to higher amortization costs, higher marketing, advertising
and distribution costs.
Gross profit
For the three months ended December 31, 2018, gross profit decreased by
6.9% to $32.3 million, compared to $34.7 million in the three months
ended December 31, 2017. The increase was mainly due to increase in
amortization, marketing, advertising and distribution costs, which was
partially offset by additional adjustment on account of adoption of new
accounting standards for three months ended December 31, 2018.
In the nine months ended December 31, 2018, gross profit decreased by
8.5% to $81.2 million, compared to $88.7 million for the nine months
ended December 31, 2017. The decrease was mainly due to increase in
marketing, advertising and distribution costs and adjustment on account
of adoption new accounting standard for the nine months ended December
31, 2018.
Adjusted EBITDA (Non- GAAP)
For the three months ended December 31, 2018, Adjusted EBITDA increased
by 21.2% to $31.4 million compared to $25.9 million in the three months
ended December 31, 2017.
The increase in Adjusted EBITDA is on account strong catalogue sales
which was partially offset by increases in amortization, marketing,
advertising and distribution costs for three months ended December 31,
2018.
In the nine months ended December 31, 2018, adjusted EBITDA increased by
39.0% to $81.9 million, compared to $58.9 million for the nine months
ended December 31, 2017.
The increase in Adjusted EBITDA is on account of strong catalogue sales,
which is partially offset by increases in amortization, marketing,
advertising and distribution cost and share based payments adjustment
for nine months ended December 31 2018.
Net finance costs
For the three months ended December 31, 2018, net finance costs
increased by 77.3% to $3.9 million, compared to $2.2 million in the
three months ended December 31, 2017 due to lower capitalization of
interest.
In the nine months ended December 31, 2018, net finance costs decreased
by 53.1% to $6.0 million, compared to $12.8 million for the nine months
ended December 31, 2017 mainly due to unwinding of credit impairment
loss reserve by $8.8 million and which was partially off-setted by lower
capitalization of interest.
Income tax expense
For the nine months ended December 31, 2018, income tax expenses
increased by 36.0% to $6.8 million, compared to $5.0 million in the nine
months ended December 31, 2017. Effective income tax rates were 11.6%
and 20.0% for December 31, 2018 and December 31, 2017, respectively
excluding non-deductible share-based payment charges and gain/loss on
fair valuation of derivative liabilities. The change in effective rate
principally reflects a change in the mix of the profits earned from
taxable and non- taxable jurisdictions.
Trade Receivables
As of December 31, 2018, Trade Receivables decreased to $210.0 million
from $225.0 million as of March 31, 2018 after considering expected
credit loss reserve upon adoption of new accounting standards during the
period.
Net Debt
As of December 31, 2018, net debt decreased by 15.9% to $159.1 million
from $189.2 million as of March 31, 2018 primarily on account of
additional equity infusion during the period.
Conference Call:
The Company will host a conference call on Thursday, February 21st,
2018, at 8:30 AM Eastern Standard Time.
To access the call please dial 929-477-0448 or 888-254-3590 from the
United States, or +44 (0)330 336 9126 or (0)800 358 6377 from outside
the U.S. The conference call I.D. number 1016781. Participants should
dial in 5 to 10 minutes before the scheduled time.
A replay of the call can be accessed through February 21, 2020 by
dialling 719-457-0820 from the U.S., or +44 (0) 207 660 0134 from
outside the U.S. The conference call I.D. number is 1016781. The call
will be available as a live webcast, which can be accessed at Eros’
Investor Relations website.
About Eros International Plc
Eros International Plc (NYSE: EROS) is a leading global company in the
Indian film entertainment industry that acquires, co-produces and
distributes Indian films across all available formats such as cinema,
television and digital new media. Eros International Plc became the
first Indian media company to list on the New York Stock Exchange. Eros
International has experience of over three decades in establishing a
global platform for Indian cinema. The Company has an extensive and
growing movie library comprising of over 3,000 films, which include
Hindi, Tamil, and other regional language films. The Company also owns
the rapidly growing OTT platform Eros Now which has rights to over
12,000 films across Hindi and regional languages. For further
information, please visit: www.erosplc.com.
|
EROS INTERNATIONAL PLC |
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|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL |
||||||||||||
|
(Amounts in thousands, except share and per share data) |
||||||||||||
| December 31, | March 31, | |||||||||||
| Note | 2018 | 2018 | ||||||||||
| ASSETS | ||||||||||||
| Non-current assets | ||||||||||||
| Property and equipment | $ | 9,266 | $ | 10,013 | ||||||||
| Goodwill | 3,800 | 3,800 | ||||||||||
|
Intangible assets - trade name |
14,000 | 14,000 | ||||||||||
|
Intangible assets - content |
5 | 1,072,686 | 998,543 | |||||||||
|
Intangible assets - others |
4,682 | 5,280 | ||||||||||
| Investments | 27,337 | 27,257 | ||||||||||
| Trade and other receivables | 1 | 7,431 | 9,144 | |||||||||
| Income tax receivable | 1,169 | 1,269 | ||||||||||
| Restricted deposits | 752 | 1,100 | ||||||||||
| Deferred tax | 64 | 351 | ||||||||||
| Total non-current assets | $ | 1,141,187 | $ | 1,070,757 | ||||||||
| Current assets | ||||||||||||
| Inventories | $ | 188 | $ | 353 | ||||||||
| Trade and other receivables | 1 | 225,978 | 245,079 | |||||||||
| Cash and cash equivalents | 88,218 | 87,762 | ||||||||||
| Investments | 1,000 |
- |
||||||||||
| Restricted deposits | 53,911 | 6,368 | ||||||||||
| Total current assets | 369,295 | 339,562 | ||||||||||
| Total assets | $ | 1,510,482 | $ | 1,410,319 | ||||||||
| LIABILITIES | ||||||||||||
| Current liabilities | ||||||||||||
| Trade and other payables | $ | 66,320 | $ | 72,142 | ||||||||
| Acceptances | 3 | 7,336 | 8,898 | |||||||||
| Short-term borrowings | 2 | 211,789 | 151,963 | |||||||||
| Current income tax payable | 12,317 | 6,324 | ||||||||||
| Total current liabilities | $ | 297,762 | $ | 239,327 | ||||||||
| Non-current liabilities | ||||||||||||
| Long-term borrowings | 2 | $ | 82,162 | $ | 124,983 | |||||||
| Other long-term liabilities | 9,514 | 3,073 | ||||||||||
| Derivative financial instruments | 610 |
- |
||||||||||
| Deferred income tax liabilities | 31,462 | 39,519 | ||||||||||
| Total non-current liabilities | $ | 123,748 | $ | 167,575 | ||||||||
| Total liabilities | $ | 421,510 | $ | 406,902 | ||||||||
| EQUITY | ||||||||||||
| Share capital |
4 |
$ | 38,584 | $ | 35,334 | |||||||
| Share premium | 562,129 | 453,997 | ||||||||||
| Reserves | 426,536 | 422,992 | ||||||||||
| Other components of equity | (57,495 | ) | (48,649 | ) | ||||||||
| JSOP reserve | (15,985 | ) | (15,985 | ) | ||||||||
| Share application pending allotment |
- |
18,000 | ||||||||||
| Equity attributable to equity holders of Eros International Plc | $ | 953,769 | $ | 865,689 | ||||||||
| Non-controlling interest | 135,203 | 137,728 | ||||||||||
| Total equity | $ | 1,088,972 | $ | 1,003,417 | ||||||||
| Total liabilities and shareholder’s equity | $ | 1,510,482 | $ | 1,410,319 | ||||||||
|
EROS INTERNATIONAL PLC |
||||||||||||||||||
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME |
||||||||||||||||||
|
(Amounts in thousands, except share and per share data) |
||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||
| December 31, | December 31, | |||||||||||||||||
| Note | 2018 | 2017 | 2018 | 2017 | ||||||||||||||
| Revenue | 8 | $ | 76,744 | $ | 65,187 | $ | 200,381 | $ | 189,327 | |||||||||
| Cost of sales | (44,459 | ) | (30,528 | ) | (119,144 | ) | (100,638 | ) | ||||||||||
| Gross profit | 32,285 | 34,659 | 81,237 | 88,689 | ||||||||||||||
| Administrative cost | (19,130 | ) | (19,567 | ) | (49,243 | ) | (50,468 | ) | ||||||||||
| Operating profit | 13,155 | 15,092 | 31,994 | 38,221 | ||||||||||||||
| Financing costs | (7,352 | ) | (2,731 | ) | (16,674 | ) | (14,264 | ) | ||||||||||
| Finance income | 3,427 | 488 | 10,685 | 1,468 | ||||||||||||||
| Net finance costs | (3,925 | ) | (2,243 | ) | (5,989 | ) | (12,796 | ) | ||||||||||
| Other gains/(losses) | 9 | 7,462 | (8,505 | ) | (797 | ) | (13,250 | ) | ||||||||||
| Profit before tax | 16,692 | 4,344 | 25,208 | 12,175 | ||||||||||||||
| Income tax | (2,218 | ) | (1,143 | ) | (6,808 | ) | (4,960 | ) | ||||||||||
| Profit for the period | $ | 14,474 | $ | 3,201 | $ | 18,400 | $ | 7,215 | ||||||||||
| Attributable to: | ||||||||||||||||||
| Equity holders of Eros International Plc | $ | 9,593 | $ | 333 | $ | 8,571 | $ | (2,398 | ) | |||||||||
| Non-controlling interest | 4,881 | 2,868 | 9,829 | 9,613 | ||||||||||||||
| Earning/(loss) per share(cents) | ||||||||||||||||||
| Basic earning/(loss) per share | 7 | 13.0 | 0.5 | 12.1 | (3.9 | ) | ||||||||||||
| Diluted earning/(loss) per share | 7 | 12.5 | (8.5 | ) | 11.8 | (13.6 | ) | |||||||||||
|
EROS INTERNATIONAL PLC |
||||||||||||||||
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE |
||||||||||||||||
|
(Amounts in thousands, except share and per share data) |
||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| Profit for the period | $ | 14,474 | $ | 3,201 | $ | 18,400 | $ | 7,215 | ||||||||
| Other comprehensive loss: | ||||||||||||||||
| Items that will be subsequently reclassified to profit or loss | ||||||||||||||||
| Exchange differences on translating foreign operations | 9,023 | 3,799 | (14,927 | ) | 2,008 | |||||||||||
|
Reclassification of the cash flow hedge to the statement of operations, net of tax |
- |
188 |
- |
375 | ||||||||||||
| Total other comprehensive income/(loss) for the period | $ | 9,023 | $ | 3,987 | $ | (14,927 | ) | $ | 2,383 | |||||||
| Total comprehensive income for the period, net of tax | $ | 23,497 | $ | 7,188 | $ | 3,473 | $ | 9,598 | ||||||||
| Attributable to: | ||||||||||||||||
| Equity holders of Eros International Plc | $ | 15,224 | $ | 2,546 | $ | (241 | ) | $ | (1,061 | ) | ||||||
| Non-controlling interest | 8,273 | 4,642 | 3,714 | 10,659 | ||||||||||||
|
EROS INTERNATIONAL PLC |
||||||||||
|
|
Nine Months Ended |
|||||||||
|
|
Note |
2018 |
2017 |
|||||||
| Cash flows from operating activities: | ||||||||||
| Profit before tax | $ | 25,208 | $ | 12,175 | ||||||
| Adjustments for: | ||||||||||
| Depreciation | 823 | 838 | ||||||||
| Share based payments | 6 | 15,073 | 13,502 | |||||||
| Amortization of intangible film and content rights | 96,158 | 87,322 | ||||||||
| Amortization of other intangibles assets | 987 | 1,112 | ||||||||
| Other non-cash items | 10 | 33,726 | 14,511 | |||||||
| Net finance costs | 14,752 | 12,796 | ||||||||
| Loss on sale of property and equipment | 3 | 18 | ||||||||
| Movement in trade and other receivables | (135,809 | ) | (105,883 | ) | ||||||
| Movement in inventories | 145 | 210 | ||||||||
| Movement in trade and other payables | 3,991 | 32,300 | ||||||||
| Cash generated from operations | 55,057 | 68,901 | ||||||||
| Interest paid | (8,755 | ) | (17,160 | ) | ||||||
| Income taxes paid | (5,714 | ) | (2,154 | ) | ||||||
| Net cash generated from operating activities | $ | 40,588 | $ | 49,587 | ||||||
| Cash flows from investing activities: | ||||||||||
| Purchases of property and equipment | (493 | ) | (191 | ) | ||||||
| Proceeds from sale of property and equipment | — | 46 | ||||||||
| Investment in restricted deposits held with banks | (47,631 | ) | 190 | |||||||
| Purchase of intangible film rights and content rights | (79,328 | ) | (89,107 | ) | ||||||
| Investment | (1,000 | ) | — | |||||||
| Purchase of other intangible assets | (575 | ) | (93 | ) | ||||||
| Interest received | 2,815 | 2,222 | ||||||||
| Net cash (used in) investing activities |
$ |
(126,212 |
) |
$ | (86,933 | ) | ||||
| Cash flows from financing activities: | ||||||||||
| Proceeds from issue of shares by subsidiary |
51 |
502 |
||||||||
| Proceeds from issue of share capital, net of transaction costs |
54,796 |
16,600 |
||||||||
| Investment in shares of a subsidiary |
(1,705 |
) |
— |
|||||||
| Proceeds from sale of shares of a subsidiary |
— |
40,221 |
||||||||
| Proceeds from short-term debt |
73,344 |
31,892 |
||||||||
| Repayment of short-term debt | (31,019 | ) |
(22,953 |
) |
||||||
| Proceeds from long-term debt |
383 |
110,829 |
||||||||
| Repayment of long-term debt | (9,382 | ) |
(111,933 |
) |
||||||
|
(Repayment of)/ proceeds from/ short term debt with maturity less than three months (net) |
660 |
(1,036 |
) |
|||||||
| Net cash generated from financing activities | $ |
87,128 |
$ |
64,122 |
||||||
| Net increase in cash and cash equivalents |
|
1,504 |
26,776 |
|||||||
| Effect of exchange rate changes on cash and cash equivalents |
|
(1,048 |
) |
(4,484 |
) |
|||||
| Cash and cash equivalents at beginning of period |
|
87,762 |
112,267 |
|||||||
| Cash and cash equivalents at end of period |
|
$ |
88,218 |
$ |
134,559 |
|||||
The cash outflow towards intangible film and content right includes,
interest paid and capitalized $7,973 (December 31,2017: $8,684).
|
Reconciliation of Liabilities arising from Financing activities: |
||||||||||||
| Long term | Short term | |||||||||||
|
debt(*) |
debt | Total | ||||||||||
| As at March 31, 2018 | $ | 188,909 | $ | 87,755 | $ | 276,664 | ||||||
| Considered in cash flow (net) |
(8,999 |
) |
42,985 |
33,986 | ||||||||
| Finance cost in relation to convertible notes | 8,299 |
- |
8,299 | |||||||||
| Movement in derivative financial instruments | 892 |
- |
892 | |||||||||
| Borrowing for purchase of property and equipment, net | 104 |
- |
104 | |||||||||
| Shares issued in lieu of convertible note | (31,690 | ) |
- |
(31,690 | ) | |||||||
|
Change in fair value of convertible notes measured at fair value through profit and loss |
18,480 |
- |
18,480 | |||||||||
| Amortization of debt issuance cost | 305 |
- |
305 | |||||||||
| Exchange adjustment |
(8,373 |
) |
(4,106 |
) | (12,479 | ) | ||||||
| As at December 31, 2018 | $ | 167,927 | $ | 126,634 | $ | 294,561 | ||||||
| (*) | including current portion and derivative financial instruments |
|
EROS INTERNATIONAL PLC |
||||||||||||||||||||||||||||||||||||||||||||
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY |
||||||||||||||||||||||||||||||||||||||||||||
|
(Amounts in thousands, except share and per share data) |
||||||||||||||||||||||||||||||||||||||||||||
| Other components of equity | Reserves | |||||||||||||||||||||||||||||||||||||||||||
| Equity | ||||||||||||||||||||||||||||||||||||||||||||
| Attributable to | ||||||||||||||||||||||||||||||||||||||||||||
| Available | Shareholders | |||||||||||||||||||||||||||||||||||||||||||
| Share | Currency | for sale | Reverse | Share | of EROS | Non- | ||||||||||||||||||||||||||||||||||||||
| Share | premium | translation | fair value | Revaluation | acquisition | Merger | Retained | JSOP | Application | International | controlling | Total | ||||||||||||||||||||||||||||||||
| capital | account | reserve | reserves | reserve | reserve | reserve | earnings | reserve | Reserve | PLC | interest | equity | ||||||||||||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||||||||||||||||||||
| Balance as at March 31, 2018 | $ | 35,334 | $ | 453,997 | $ | (56,722 | ) | $ | 6,238 | $ | 1,835 | $ | (22,752 | ) | $ | 70,484 | $ | 375,260 | $ | (15,985 | ) | $ | 18,000 | $ | 865,689 | $ | 137,728 | $ | 1,003,417 | |||||||||||||||
|
Adoption of IFRS 15/9 |
- |
- |
(34 | ) |
- |
- |
- |
- |
(14,270 | ) |
- |
- |
(14,304 | ) | (3,520 | ) | (17,824 | ) | ||||||||||||||||||||||||||
| Balance as at April 1, 2018 | $ | 35,334 | $ | 453,997 | $ | (56,756 | ) | $ | 6,238 | $ | 1,835 | $ | (22,752 | ) | $ | 70,484 | $ | 360,990 | $ | (15,985 | ) | $ | 18,000 | $ | 851,385 | $ | 134,208 | $ | 985,593 | |||||||||||||||
| Profit for the period |
- |
- |
- |
- |
- |
- |
- |
8,571 |
- |
- |
8,571 | 9,829 | 18,400 | |||||||||||||||||||||||||||||||
| Other comprehensive income/(loss) for the period |
- |
- |
(8,812) |
- |
- |
- |
- |
- |
- |
- |
(8,812) | (6,115 | ) | (14,927 | ) | |||||||||||||||||||||||||||||
|
Total comprehensive income/(loss) for the period |
- |
- |
(8,812) |
- |
- |
- |
- |
8,571 |
- |
- |
(241) | 3,714 | 3,473 | |||||||||||||||||||||||||||||||
| Issue of shares | 1,948 | 70,718 |
- |
- |
- |
- |
- |
- |
- |
(18,000 | ) | 54,666 |
- |
54,666 | ||||||||||||||||||||||||||||||
| Shares issued on exercise of employee stock options and awards | 278 | 6,748 |
- |
- |
- |
- |
- |
(6,895 | ) |
- |
- |
131 |
- |
131 | ||||||||||||||||||||||||||||||
| Share based Compensation |
- |
- |
- |
- |
- |
- |
- |
14,668 |
- |
- |
14,668 | 405 | 15,073 | |||||||||||||||||||||||||||||||
|
Changes in ownership interests in subsidiaries that do not result in a loss of control |
- |
- |
- |
- |
- |
- |
1470 |
- |
- |
- |
1470 | (3,124) | (1,654) | |||||||||||||||||||||||||||||||
| Shares issued in lieu of convertible notes | 1,024 | 30,666 |
- |
- |
- |
- |
- |
- |
- |
- |
31,690 |
- |
31,690 | |||||||||||||||||||||||||||||||
|
Balance as at December 31, 2018 |
$ | 38,584 | $ | 562,129 | $ | (65,568 | ) | $ | 6,238 | $ | 1,835 | $ | (22,752 | ) | $ | 71,954 | $ | 377,334 | $ | (15,985 | ) | $ |
- |
$ | 953,769 | $ | 135,203 | $ | 1,088,972 | |||||||||||||||
|
EROS INTERNATIONAL PLC |
|||||||||||||||||||||||||||||||||||||||||||
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY |
|||||||||||||||||||||||||||||||||||||||||||
|
(Amounts in thousands, except share and per share data) |
|||||||||||||||||||||||||||||||||||||||||||
| Other components of equity | Reserves | ||||||||||||||||||||||||||||||||||||||||||
| Equity | |||||||||||||||||||||||||||||||||||||||||||
| Attributable | |||||||||||||||||||||||||||||||||||||||||||
| to | |||||||||||||||||||||||||||||||||||||||||||
| Available | Shareholders | ||||||||||||||||||||||||||||||||||||||||||
| Share | Currency | for sale | Reverse | of EROS | Non- | ||||||||||||||||||||||||||||||||||||||
| Share | premium | translation | fair value | Revaluation | Hedging | acquisition | Merger | Retained | JSOP | International | controlling | Total | |||||||||||||||||||||||||||||||
| capital | account | reserve | reserves | reserve | reserve | reserve | reserve | earnings | reserve | PLC | interest | equity | |||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||
| Balance as at April 1, 2017 | $ | 31,877 | $ | 399,686 | $ | (55,810 | ) | $ | 6,238 | $ | 1,829 | $ | (375 | ) | $ | (22,752 | ) | $ | 70,275 | $ | 389,474 | $ | (15,985 | ) | $ | 804,457 | $ | 79,091 | $ | 883,548 | |||||||||||||
| (Loss)/)Profit for the period |
- |
- |
- |
- |
- |
- |
- |
- |
(2,398 | ) |
- |
(2,398 | ) | 9,613 | 7,215 | ||||||||||||||||||||||||||||
| Other comprehensive income/(loss) for the period |
- |
- |
962 |
- |
- |
375 |
- |
- |
- |
- |
1,337 | 1,046 | 2,383 | ||||||||||||||||||||||||||||||
| Total comprehensive income/(loss) for the period |
- |
- |
962 |
- |
- |
375 |
- |
- |
(2,398 | ) |
- |
(1,061 | ) | 10,659 | 9,598 | ||||||||||||||||||||||||||||
| Share based compensation |
- |
- |
- |
- |
- |
- |
- |
- |
13,036 |
- |
13,036 | 466 | 13,502 | ||||||||||||||||||||||||||||||
| Shares issued on exercise of employee stock options and awards | 221 | 7,238 |
- |
- |
- |
- |
- |
- |
(7,288 | ) |
- |
171 |
- |
171 | |||||||||||||||||||||||||||||
| Issue of shares | 555 | 15,874 |
- |
- |
- |
- |
- |
- |
- |
- |
16,429 |
- |
16,429 | ||||||||||||||||||||||||||||||
|
Changes in ownership interests in subsidiaries that do not result in a loss of control |
- |
- |
- |
- |
- |
- |
- |
- |
1,030 |
- |
1,030 | 39,693 | 40,723 | ||||||||||||||||||||||||||||||
|
Loss of Control
in a subsidiary |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
4,878 | 4,878 | ||||||||||||||||||||||||||||||
| Balance as at December 31, 2017 | $ | 32,653 | 422,798 | (54,848 | ) | 6,238 | 1,829 |
- |
(22,752 | ) | 70,275 | 393,854 | (15,985 | ) | 834,062 | 134,787 | 968,849 | ||||||||||||||||||||||||||
| EROS INTERNATIONAL PLC | ||||||||
|
NOTES TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS |
||||||||
| (Amounts in thousands, except share and per share data) | ||||||||
|
1. TRADE AND OTHER RECEIVABLES |
||||||||
| As at | ||||||||
| December 31, | March 31, | |||||||
| 2018 | 2018 | |||||||
| Trade accounts receivables | $ | 249,943 | $ | 235,191 | ||||
| Credit impairment (loss) | (39,921 | ) | (10,193 | ) | ||||
| Trade accounts receivables net | 210,022 | 224,998 | ||||||
| Other receivables* | 19,849 | 20,933 | ||||||
| Prepaid charges | 1,750 | 2,700 | ||||||
| Accrued revenues | 1,788 | 5,592 | ||||||
| Trade and other receivables | $ | 233,409 | $ | 254,223 | ||||
| Current | 225,978 | 245,079 | ||||||
| Non-current | 7,431 | 9,144 | ||||||
| $ | 233,409 | $ | 254,223 | |||||
|
2. BORROWINGS |
||||||||||||
|
An analysis of long-term borrowings is shown in the table below. |
||||||||||||
| As at | ||||||||||||
| Nominal | December 31, | March 31, | ||||||||||
| Interest Rate | Maturity | 2018 | 2018 | |||||||||
| Asset backed borrowings | ||||||||||||
| Vehicle loan | 7.5% - 10.25% | 2017-21 | $ | 440 | $ | 560 | ||||||
| Term loan | 9.12% - 11.66% | 2018-22 | 210 |
- |
||||||||
| Term loan | BPLR+2.85% | 2019-20 | 1,596 | 3,453 | ||||||||
| Term loan | BPLR+2.55% - 3.4% | 2020-21 | 6,044 | 8,767 | ||||||||
| Term loan | 13.75% | 2022-23 | 6,617 | 9,580 | ||||||||
| Term loan | MCLR+3.45% | 2021-22 | 8,318 | 11,976 | ||||||||
| $ | 23,225 | $ | 34,336 | |||||||||
| Unsecured borrowings | ||||||||||||
| Retail bond | 6.5% | 2021-22 | $ | 63,800 | 70,055 | |||||||
| Convertible notes | 14.2% | 2020-21 | 81,099 | 86,010 | ||||||||
| $ | 144,899 | $ | 156,065 | |||||||||
| Nominal value of borrowings | $ | 168,124 | $ | 190,401 | ||||||||
| Cumulative effect of unamortized costs | (807) | (1,210 | ) | |||||||||
| Installments due within one year | (85,155) | (64,208 | ) | |||||||||
| Long-term borrowings | $ | 82,162 | $ | 124,983 | ||||||||
Bank prime lending rate (“BPLR”) and Marginal Cost based lending rate
(“MCLR”) is the Indian equivalent to LIBOR. Asset backed borrowings are
secured by fixed and floating charges over certain Group assets.
Analysis of short-term borrowings
| As at | |||||||||
| Nominal | December 31, | March 31, | |||||||
| interest rate (%) | 2018 | 2018 | |||||||
| Asset backed borrowings | |||||||||
| Export credit bill discounting and overdraft |
BPLR+1%-3.5% |
$ | 39,307 | $ | 43,518 | ||||
| Export credit and overdraft | LIBOR+4.5% | 20,955 | 21,226 | ||||||
| Short term loan | 13-14.25% | 20,255 | 11,537 | ||||||
| Other short term loan | 10.20% | 46,117 | 11,474 | ||||||
| $ | 126,634 | $ | 87,755 | ||||||
| Unsecured borrowings | |||||||||
| Installments due within one year on long-term borrowings | 85,155 | 64,208 | |||||||
| Short-term borrowings | $ | 211,789 | $ | 151,963 | |||||
|
3. ACCEPTANCES |
|||||||
| December 31, | March 31, | ||||||
| 2018 | 2018 | ||||||
| (in thousands) | |||||||
| Payable under the film financing arrangements | $ | 7,336 | $ | 8,898 | |||
| $ | 7,336 | $ | 8,898 | ||||
Acceptances comprise of credit availed from financial institutions for
payment to film producers for film co-production arrangement entered by
the group. The carrying value of acceptances are considered a reasonable
approximation of fair value.
|
4. ISSUED SHARE CAPITAL |
|||||||
| Number of | |||||||
| Shares | GBP | ||||||
| Authorized | |||||||
| Ordinary shares of 30p each at March 31, 2018 | 100,000,000 | 30,000 | |||||
| Ordinary shares of 30p each at December 31, 2018(*) | 150,000,000 | 45,000 | |||||
| (*) |
The Company increased authorized number of shares to 150,000,000 on October 25, 2018. |
|
EROS INTERNATIONAL PLC |
|||||||||||
|
NOTES TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL |
|||||||||||
|
(Amounts in thousands, except share and per share data) |
|||||||||||
| Number of Shares | USD | ||||||||||
| A Ordinary | B Ordinary | ||||||||||
| Allotted, called up and fully paid | 30p Shares((*)) | 30p Shares((*)) | (in thousands) | ||||||||
| As at March 31, 2017 | 41,312,202 | 19,379,382 | $ | 31,877 | |||||||
| Issue of shares in the quarter ended June 30, 2017 | 12,000 |
- |
5 | ||||||||
| Issue of shares in the quarter ended September 30, 2017 | 288,291 |
- |
114 | ||||||||
| Issue of shares in the quarter ended December 31, 2017 | 1,681,520 |
- |
657 | ||||||||
| Transfer of B Ordinary to A Ordinary share | 9,666,667 | (9,666,667 | ) |
- |
|||||||
| Issue of shares in the quarter ended March 31, 2018 | 2,757,743 |
- |
2,681 | ||||||||
| As at March 31, 2018 | 55,718,423 | 9,712,715 | $ | 35,334 | |||||||
| Issue of shares in the quarter ended June 30, 2018 | 2,747,645 |
- |
$ | 1,138 | |||||||
| Issue of shares in the quarter ended September 30, 2018 | 3,773,385 |
- |
$ | 1,471 | |||||||
| Issue of shares in the quarter ended December 31, 2018 | 1,659,767 |
- |
$ | 641 | |||||||
| As at December 31, 2018 | 63,899,220 | 9,712,715 | 38,584 | ||||||||
The Company issued A Ordinary shares as follows:
| Number of Shares | |||||||||||
| December 31, | March 31, | ||||||||||
| 2018 | 2017 | 2018 | |||||||||
| Issuance to Founders Group (**) | 1,769,911 |
- |
1,421,520 | ||||||||
| Issuance towards settlement of Convertible notes | 2,580,687 |
- |
2,624,668 | ||||||||
|
Exercise against Restricted Share Unit/ Management scheme (*****) |
708,695 | 300,291 | 683,158 | ||||||||
| Issuance towards Reliance Industries Limited (***) | 3,111,088 |
- |
- |
||||||||
| 2015 Share Plan (****) | 10,416 |
- |
10,208 | ||||||||
| Total | 8,180,797 |
300,291 |
4,739,554 | ||||||||
(*) Each A ordinary shares is entitled to one vote on all
matters and each B shares is entitled to ten votes.
(**)
Average exercise price of $14.69 (December 31,2017 Nil and March 31,
2018 $11.6)
(***) Average exercise price of $15
(December 31, 2017 Nil and March 31, 2018 $Nil)
(****)
Average exercise price of $7.93 (December 31, 2017 Nil and March 31,
2018 $8.71)
(*****) Certain shares exercised price at
$0.40 (December 2017 Nil and March 2018 Nil)
|
5. INTANGIBLE ASSETS – CONTENT |
|||||||||||
| Gross | |||||||||||
| Content | Accumulated | Content | |||||||||
| Assets | Amortization | Assets | |||||||||
| As at December 31, 2018 | |||||||||||
| Film and content rights | $ | 1,618,020 | $ | (918,114 | ) | $ | 699,906 | ||||
| Content advances | 361,548 |
- |
361,548 | ||||||||
| Film productions | 11,232 |
- |
11,232 | ||||||||
| Non-current content assets | $ | 1,990,800 | $ | (918,114 | ) | $ | 1,072,686 | ||||
| As at March 31, 2018 | |||||||||||
| Film and content rights | $ | 1,493,099 | $ | (854,991 | ) | $ | 638,108 | ||||
| Content advances | 349,568 |
- |
349,568 | ||||||||
| Film productions | 10,867 |
- |
10,867 | ||||||||
| Non-current content assets | $ | 1,853,534 | $ | (854,991 | ) | $ | 998,543 | ||||
|
6. SHARE BASED COMPENSATION PLANS |
||||||||||||||||
|
The compensation cost recognized with respect to all outstanding plans and by grant of shares, which |
||||||||||||||||
| are all equity settled instruments, is as follows: | ||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| IPO India Plan | $ | 252 | $ | 511 | $ | 1,031 | $ | 1,230 | ||||||||
| JSOP Plan |
- |
- |
- |
615 | ||||||||||||
| Option award scheme 2012 |
- |
- |
- |
197 | ||||||||||||
| 2014 Share Plan |
- |
(467 | ) | 47 | (83 | ) | ||||||||||
| 2015 Share Plan(*) | 607 | 19 | 2,959 | 86 | ||||||||||||
| Other share option awards (**) | 800 | 4,109 | 4,155 | 5,871 | ||||||||||||
| Management scheme (staff share grant)(***) | 2,298 | 1,859 | 6,881 | 5,586 | ||||||||||||
| $ | 3,957 | $ | 6,031 | $ | 15,073 | $ | 13,502 | |||||||||
(*) includes of 1,105,399 options granted towards
Share Plan 2015 during nine months ended December 31, 2018 at an average
exercise price of $14.34 per share and average grant date fair value
$3.02 per share.
(**) includes Restricted Share
Unit (RSU) and Other share option plans. In respect of 150,149
units/options granted towards RSU during nine months ended December 31,
2018, grant date fair value approximates intrinsic value.
(***)
Includes 1,000,000 shares granted during nine months ended December 31,
2018 to management personnel.
|
EROS INTERNATIONAL PLC |
||||||||||||||||||||||||||||||||
|
NOTES TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL |
||||||||||||||||||||||||||||||||
|
(Amounts in thousands, except share and per share data) |
||||||||||||||||||||||||||||||||
| Three months ended December 31, | Nine months ended December 31, | |||||||||||||||||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||||||
| Basic | Diluted | Basic | Diluted | Basic | Diluted | Basic | Diluted | |||||||||||||||||||||||||
| Earnings/(loss) attributable to the equity holders of the parent | $ | 9,593 | 9,593 | $ | 333 | 333 | $ | 8,571 | 8,571 | $ | (2,398 | ) | (2,398 | ) | ||||||||||||||||||
| Potential dilutive effect of senior convertible bonds |
- |
1,347 |
- |
(6,006) |
- |
- |
- |
(6,006) | ||||||||||||||||||||||||
|
Potential dilutive effect related to share based compensation scheme in subsidiary undertaking |
- |
(38) |
- |
(80) |
- |
(186) |
- |
(318) | ||||||||||||||||||||||||
| Adjusted earnings/(loss) attributable to equity holders of the parent | $ | 9,593 | 10,902 | $ | 333 | (5,753 | ) | $ | 8,571 | 8,385 | $ | (2,398 | ) | (8,722 | ) | |||||||||||||||||
| Number of shares | ||||||||||||||||||||||||||||||||
| Weighted average number of shares | 73,668,766 | 73,668,766 | 61,715,635 | 61,715,635 | 70,879,289 | 70,879,289 | 61,132,018 | 61,132,018 | ||||||||||||||||||||||||
|
Potential dilutive effect related to share based compensation scheme and senior convertible notes |
- |
13,510,251 |
- |
5,860,475 |
- |
46,075 |
- |
2,969,105 | ||||||||||||||||||||||||
| Adjusted weighted average number of shares | 73,668,766 | 87,179,017 | 61,715,635 | 67,576,110 | 70,879,289 | 70,925,364 | 61,132,018 | 64,101,123 | ||||||||||||||||||||||||
| Earnings per share | ||||||||||||||||||||||||||||||||
|
Earning attributable to the equity holders of the parent per share (cents) |
13.0 | 12.5 | 0.5 | (8.5 | ) | 12.1 | 11.8 | (3.9 | ) | (13.6 | ) | |||||||||||||||||||||
The above table does not split the earnings per share separately for the
‘A’ ordinary 30p shares and the ‘B’ ordinary 30p shares as there is no
variation in their entitlement to participate in undistributed earnings.
|
8. BUSINESS SEGMENTAL DATA |
|||||||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||
| December 31, | December 31, | ||||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
| Revenue by customer's location | |||||||||||||||||||
| India | $ | 31,395 | $ | 26,724 | $ | 88,178 | $ | 81,293 | |||||||||||
| Europe | 450 | 253 | 906 | 2,297 | |||||||||||||||
| North America | 1,936 | 1,444 | 4,345 | 3,703 | |||||||||||||||
| Rest of the world | 42,963 | 36,766 | 106,952 | 102,034 | |||||||||||||||
| Total Revenue | $ | 76,744 | $ | 65,187 | $ | 200,381 | $ | 189,327 | |||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||
| December 31, | December 31, | ||||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
| Revenue by group's operation | |||||||||||||||||||
| India | $ | 28,356 | $ | 22,253 | $ | 75,761 | $ | 73,024 | |||||||||||
| Europe | 12,268 | 5,065 | 43,146 | 19,698 | |||||||||||||||
| North America | 781 | 125 | 1,527 | 702 | |||||||||||||||
| Rest of the world | 35,339 | 37,744 | 79,947 | 95,903 | |||||||||||||||
| Total Revenue | $ | 76,744 | $ | 65,187 | $ | 200,381 | $ | 189,327 | |||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||
| December 31, | December 31, | ||||||||||||||||||
| 2018 | 2017 | 2018 |
2017(1) |
||||||||||||||||
| Revenue by source | |||||||||||||||||||
| Theatrical | $ | 21,759 | $ | 12,911 | $ | 55,480 | $ | 55,919 | |||||||||||
| Satellite Content licensing | 19,317 | 29,353 | 55,503 | 70,005 | |||||||||||||||
| Digital and other ancillary | 35,668 | 22,923 | 89,398 | 63,403 | |||||||||||||||
| Total Revenue | $ | 76,744 | $ | 65,187 | $ | 200,381 | $ | 189,327 | |||||||||||
|
(1) As noted above, prior period amounts have not been adjusted |
|||||||||||||||||||
|
EROS INTERNATIONAL PLC |
||||||||||||||||
|
NOTES TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL |
||||||||||||||||
|
(Amounts in thousands, except share and per share data) |
||||||||||||||||
|
9. OTHER GAINS/(LOSSES) |
||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| Foreign exchange (loss)/gain, net | $ | 1,545 | $ | 313 | $ | 5,234 | $ | (3,619 | ) | |||||||
| (Loss) on sale of property and equipment | (3 | ) | (14 | ) | (3 | ) | (18 | ) | ||||||||
| Reversal of expected credit (loss) | 3,895 |
- |
14,458 |
- |
||||||||||||
|
Net (loss) on derecognition of financial assets measured at amortized cost, net(*) |
(1,566 | ) | (930 | ) | (4,334 | ) | (2,708 | ) | ||||||||
| (Loss) on settlement of derivative financial instruments |
- |
(1,555 | ) |
- |
(586 | ) | ||||||||||
|
(Loss) on deconsolidation of a subsidiary |
- |
(13,294 | ) |
- |
(13,294 | ) | ||||||||||
| Others |
- |
(1 | ) |
- |
(1 | ) | ||||||||||
|
(Loss)/Gain on financial liability (convertible notes) measured at fair value through profit and loss |
1,263 | 6,976 | (18,480 | ) | 6,976 | |||||||||||
| Credit from Government of India | 2,328 |
- |
2,328 |
- |
||||||||||||
| $ | 7,462 | $ | (8,505 | ) | $ | (797 | ) | $ | (13,250 | ) | ||||||
(*) arising on assignment and novation of trade receivables
and trade payables with no-recourse. Derecognition of aforesaid
financial assets/liabilities measured at amortized cost is to mitigate
both credit risk and liquidity risk
| 10. | NON-CASH EXPENSE/(INCOME) |
Significant non-cash expenses except loss on sale of assets, share based
compensation, depreciation, derivative interest and amortization were as
follows:
|
Nine months ended December 31, |
||||||||||
| 2018 | 2017 | |||||||||
| (in thousands) | ||||||||||
| Loss on settlement of derivative financial instruments | $ | — | $ | 586 | ||||||
| Provisions for trade and other receivables | 2,893 | 1,795 | ||||||||
| Content impairment | 667 | — | ||||||||
| Credit impairment losses, net | 11,917 | 4,446 | ||||||||
|
(Gain)/Loss on financial liability (convertible notes) measured at fair value through profit and loss |
18,480 | (6,976 | ) | |||||||
|
Net Loss on derecognition of financial assets measured at amortized cost, net |
4,334 | 2,708 | ||||||||
| Unrealized foreign exchange loss/(gain), net | (4,870 | ) | (1,343 | ) | ||||||
| Loss on deconsolidation of a subsidiary | — | 13,294 | ||||||||
| Others | 305 | 1 | ||||||||
| $ | 33,726 | $ | 14,511 | |||||||
|
11. NON GAAP FINANCIAL MEASURES |
||||||||||||||||
|
Gross Revenue (Non – GAAP) |
||||||||||||||||
| Three months ended December 31, | Nine months ended December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| (in thousand) | ||||||||||||||||
| Revenue (GAAP) | $ | 76,744 | $ | 65,187 | $ | 200,381 | $ | 189,327 | ||||||||
| Adjustment towards significant financing component | 9,917 | 2,286 | 25,164 | 4,404 | ||||||||||||
| Gross Revenue (Non -GAAP) | $ | 86,661 | $ | 67,473 | $ | 225,545 | $ | 193,731 | ||||||||
|
Adjusted EBITDA |
||||||||||||||||
| Three months ended December 31, | Nine months ended December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| (in thousand) | ||||||||||||||||
| Net income (GAAP) | $ | 14,474 | $ | 3,201 | $ | 18,400 | $ | 7,215 | ||||||||
| Income tax expense | 2,218 | 1,143 | 6,808 | 4,960 | ||||||||||||
| Net finance costs | 3,925 | 2,243 | 5,989 | 12,796 | ||||||||||||
| Depreciation | 296 | 305 | 823 | 838 | ||||||||||||
| Amortization(1) | 228 | 387 | 987 | 1,112 | ||||||||||||
| EBITDA | 21,141 | 7,279 | 33,007 | 26,921 | ||||||||||||
| Share based payments(2) | 3,957 | 6,031 | 15,073 | 13,502 | ||||||||||||
| Credit impairment losses/(gains)(3) | (3,895 | ) | 1,439 | (14,458 | ) | 4,446 | ||||||||||
| Adjustment towards arisen significant discounting, component (3) | 9,917 | 2,286 | 25,164 | 4,404 | ||||||||||||
|
Net losses on de-recognition of financial assets measured at amortized cost, net |
1,566 | 930 | 4,334 | 2,708 | ||||||||||||
|
Loss/(Gain) on financial liability (convertible notes) measured at fair value through profit and loss |
(1,263 | ) | (6,976 | ) | 18,480 | (6,976 | ) | |||||||||
| Closure of derivative asset |
- |
- |
249 |
- |
||||||||||||
| Loss on sale of property and equipment | 3 | 14 | 3 | 18 | ||||||||||||
| Loss on settlement of derivative financial instruments |
- |
1,555 |
- |
586 | ||||||||||||
| Loss on deconsolidation of a subsidiary |
- |
13,294 |
- |
13,294 | ||||||||||||
| Others |
- |
1 |
- |
1 | ||||||||||||
| Adjusted EBITDA (Non-GAAP) | $ | 31,426 | $ | 25,853 | $ | 81,852 | $ | 58,904 | ||||||||
|
Amortization of intangible and content rights |
35,835 | 26,606 | 96,158 | 87,322 | ||||||||||||
| Gross Adjusted EBITDA | $ | 67,261 | $ | 52,459 | $ | 178,010 | $ | 146,226 | ||||||||
(1) Includes only amortization of intangible assets other than
intangible content assets.
(2) Consists of compensation costs
recognized with respect to all outstanding plans and all other equity
settled instruments.
(3) Comparatives number have been reclassified
on account of adoption of IFRS 15.
12. NEW STANDARDS ADOPTED AS AT APRIL 1, 2018
Adoption of IFRS 15, "Revenue from Contracts with Customers"
On April 1, 2018, the Group adopted IFRS 15, “Revenue from Contracts
with Customers” (‘IFRS 15’), using the modified retrospective method
applied to all contracts as of April 1, 2018. Results for reporting
periods beginning after April 1, 2018 are presented under IFRS 15, while
prior period amounts are not adjusted and continue to be reported in
accordance with our historic accounting under IAS 18, Revenue (‘IAS 18’).
Revenue arises mainly from production and distribution of media content,
television syndication or satellite rights and digital and ancillary
rights.
The Group determines revenue recognition through the following steps:
1. Identification of the contract, or contracts, with a customer
2.
Identification of the performance obligations in the contract
3.
Determination of the transaction price
4. Allocation of the
transaction price to the performance obligations in the contract
5.
Recognition of revenue when, or as, a performance obligation/s are
satisfied.
In all cases, the total transaction price for a contract is allocated
amongst the various performance obligations based on their relative
stand-alone selling prices. The transaction price for a contract,
excludes any amounts collected on behalf of third parties.
|
EROS INTERNATIONAL PLC |
|
NOTES TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL |
|
(Amounts in thousands, except share and per share data) |
Revenue is recognised either at a point in time or over time, when (or
as) the Group satisfies performance obligations by transferring the
promised goods or services to its customers in an amount that reflects
the consideration that it expects to receive in exchange for those
services.
At contract inception, the Group assesses the services promised in the
contracts with customers and identifies a performance obligation for
each promise to transfer to the customer a service (or bundle of
services) that is distinct. To identify the performance obligations, the
Group considers all of the services promised in the contract regardless
of whether they are explicitly stated or are implied by customary
business practices.
The Group recognises contract liabilities for consideration received in
respect of unsatisfied performance obligations and reports these amounts
within ‘Trade and other payables’ in the Statement of Financial
Position. Similarly, if the Group satisfies a performance obligation
before it receives the consideration, the Group recognises either a
contract asset or accrued receivable within ‘Trade and other
receivables’ in the Statement of Financial Position, depending on
whether something other than the passage of time is required before the
consideration is due.
For certain content licensing arrangements, the Group’s collection
period range between 2 – 3 years from contract inception date. Under
IFRS 15, an entity needs to adjust the promised amount of consideration
for the effects of the time value of money if the timing of payments
agreed to by the parties to the contract (either explicitly or
implicitly) provides the customer or the entity with a significant
benefit. As such, for arrangements where the implied collection period
(or normal credit term) is considered to be more than 1 year, revenue is
recognised after adjusting the promised amount of consideration for a
significant financing component, using the discount rate that would be
reflected in a separate financing transaction between the entity and its
customer at contract inception. The effects of financing, i.e. unwinding
of the financing component, is recognised separately from revenue from
contracts with customers in the Statement of Income, within ‘Finance
income’. Any subsequent change in collection date from the anticipated
collection date considered on the contract inception date has been
recognised separately in the Statement of Income, within ‘Other
gains/(losses), net.
For the nine months ended December 31, 2018, revenue amounting $7,603
included in the contract liability balance at the beginning of the
period.
In case of television syndication rights, as on December 31, 2018, there
were certain films in respect of which rights have not been transferred
either because the delivery of the content has not been made or
effective date mentioned in the contract has not arrived as on the
reporting date. The aggregate amount of license fees allocated to the
above movies for the nine months ended December 31, 2018 is $11,810.
As such, the Group has performance obligations associated with fixed
commitments in customer contracts for future services that have not yet
been recognized in our condensed interim consolidated financial
statements is $7,387 as of December 31, 2018. The Company expects to
recognize revenue on approximately 80% of these remaining performance
obligations by 12 months with the balance recognition thereafter.
Practical Expedients and Exemptions
The Group generally expense sales commissions when incurred because the
amortization period would have been one year or less. These costs are
recorded within sales and marketing expenses.
Adoption of IFRS 9, "Financial Instruments"
On April 1, 2018, the Company adopted IFRS 9, “Financial Instruments”
(‘IFRS 9’), using the modified retrospective method applied as of April
1, 2018. IFRS 9 Financial Instruments replaces IAS 39 ‘Financial
Instruments: Recognition and Measurement’ requirements with effect from
April 1, 2018. When adopting IFRS 9, the Group elected not to restate
prior periods. Rather, differences arising from the adoption of IFRS 9
in relation to classification, measurement, and impairment are
recognized in opening retained earnings as of 1 April 2018.
Major changes in IFRS 9 as compared to IAS 39 is on account of
introduction of the expected credit loss model and the changes in
categories of financial assets and financial liabilities.
The adoption of IFRS 9 has mostly impacted the following areas:
|
EROS INTERNATIONAL PLC |
|
NOTES TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL |
|
(Amounts in thousands, except share and per share data) |
-
The classification and measurement of the Group’s financial assets.
Management holds most financial assets to hold and collect the
associated cash flows. -
The impairment of financial assets applying the expected credit loss
model. This applies now to the Group’s trade and other receivables.
For contract assets arising from IFRS 15 and trade receivables, the
Group applies a simplified model of recognising lifetime expected
credit losses. For all other financial assets, expected credit losses
are measured at an amount equal to the twenty-four month ECL, unless
there has been a significant increase in credit risk from initial
recognition in which case those are measured at lifetime ECL. -
The measurement of available for sale equity investments at cost less
impairment. This investment is now measured at fair value with changes
in fair value presented in other comprehensive income. -
The recognition of gains and losses arising from the Group’s from own
credit risk. The Group continues to elect the fair value option for
certain financial liabilities which means that fair value movements
from changes in the Group’s own credit risk are now presented in other
comprehensive income rather than profit or loss.
Details showing the Classification and measurement of the Company’s
financial instruments on adoption of IFRS 9 as of 1 April 2018.
| Total | Total | ||||||||||
| IAS 39 Category | IFRS 9 Category | carrying value | fair value | ||||||||
| Financial Assets | |||||||||||
| Cash and cash equivalents | Loans and Receivables | At amortized cost | 87,762 | 87,762 | |||||||
| Restricted deposits | Loans and Receivables | At amortized cost | 7,468 | 7,468 | |||||||
| Investment in equity instruments | Available for sale financial assets | Financial assets at FVTOCI* | 27,257 | 27,257 | |||||||
| Trade and other receivables | Loans and Receivables | At amortized cost | 235,726 | 235,726 | |||||||
| Total | 358,213 | 358,213 | |||||||||
| Total | Total | ||||||||||
| IAS 39 Category | IFRS 9 Category | carrying value | fair value | ||||||||
| Financial Liabilities | |||||||||||
| Total borrowings (excluding convertible notes) | At amortized cost | At amortized cost | 190,936 | 174,533 | |||||||
| Convertible notes | Financial liabilities at FVTPL | Financial liabilities at FVTPL** | 86,010 | 86,010 | |||||||
| Trade and other payables | At amortized cost | At amortized cost | 72,142 | 72,142 | |||||||
| Acceptances | At amortized cost | At amortized cost | 8,898 | 8,898 | |||||||
| Total | 357,986 | 341,583 | |||||||||
* FVTOCI – Fair value through other comprehensive income.
** FVTPL
- Fair value through profit and loss.
The cumulative effect of the changes made to the consolidated interim
Statement of Financial Position as of April 1, 2018 in respect of the
adoption of IFRS 9 were as follows:
| As of | ||||||||||||
| March 31, | As of | |||||||||||
| 2018 | April 1, | |||||||||||
| Assets | (Reported) | IFRS 9 | 2018 | |||||||||
| Trade and other receivables | $ | 254,223 | $ | (18,497 | ) | $ | 235,726 | |||||
| Liabilities and Shareholders' Equity | ||||||||||||
| Currency translation reserve | (56,722 | ) | (34 | ) | (56,756 | ) | ||||||
| Retained earnings | 375,260 | (14,270 | ) | 360,990 | ||||||||
| Deferred income tax liabilities | 39,519 | (673 | ) | 38,846 | ||||||||
| Non-controlling interests | 137,728 | (3,520 | ) | 134,208 | ||||||||
|
EROS INTERNATIONAL PLC |
|
NOTES TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL |
|
(Amounts in thousands, except share and per share data) |
However, as a result of adopting IFRS 15, amounts reported under IFRS 15
were not materially different from amounts that would have been reported
under the previous revenue guidance of IAS 18, as such, cumulative
adjustments to retained earnings is not material.
The Impact adoption of IFRS 15 and IFRS 9 on our consolidated statement
of financial position as at December 31, 2018 were as follows:
| Balance at | ||||||||||||||||
| December 31, | ||||||||||||||||
| Balance at | 2018 | |||||||||||||||
| December 31, | (without | |||||||||||||||
| 2018 | adoption of | |||||||||||||||
| Assets | (Reported) | IFRS 9 | IFRS 15 | IFRS 9/15) | ||||||||||||
| Trade and other receivables | $ | 233,409 | $ | (15,270 | ) | $ | (17,641 | ) | $ | 266,320 | ||||||
| Liabilities and Shareholders' Equity | ||||||||||||||||
|
Currency translation reserve |
(65,568 | ) | 206 |
- |
(65,774 | ) | ||||||||||
|
Retained earnings |
377,334 | (8,945 | ) | (16,386 | ) | 402,665 | ||||||||||
|
Deferred income tax liabilities |
31,462 | (673 | ) |
- |
32,135 | |||||||||||
|
Non-controlling interests |
135,203 | (5,857 | ) | (1,255 | ) | 142,315 | ||||||||||
The impact of adoption of IFRS 15 and IFRS 9 on the consolidated interim
statement of income for three month ended December 31, 2018 was as
follow.
| December 31, | ||||||||||||||||
| 2018 | ||||||||||||||||
| December 31, | (without | |||||||||||||||
| 2018 | adoption | |||||||||||||||
| (Reported) | IFRS 9 | IFRS 15 | of IFRS 9/15) | |||||||||||||
| Revenue | $ | 76,744 | $ |
- |
$ | 6,962 | $ | 83,706 | ||||||||
| Cost of sales | (44,459 | ) |
- |
- |
(44,459 | ) | ||||||||||
| Gross profit | 32,285 |
- |
6,962 | 39,247 | ||||||||||||
| Administrative cost | (19,130 | ) | 4,975 | (14,155 | ) | |||||||||||
| Operating profit | 13,155 | 4,975 | 6,962 | 25,092 | ||||||||||||
| Financing costs | (7,352 | ) |
- |
- |
(7,352 | ) | ||||||||||
| Finance income | 3,427 | (119 | ) |
- |
3,308 | |||||||||||
| Net finance costs | (3,925 | ) | (119 | ) |
- |
(4,044 | ) | |||||||||
| Other gains/ (losses) | 7,462 | (3,895 | ) |
- |
3,567 | |||||||||||
| Profit before tax | 16,692 | 961 | 6,962 | 24,615 | ||||||||||||
| Income tax | (2,218 | ) |
- |
- |
(2,218 | ) | ||||||||||
| Profit for the period | 14,474 | 961 | 6,962 | 22,397 | ||||||||||||
| Attributable to: | ||||||||||||||||
| Equity holders of Eros International Plc | 9,593 | (463 | ) | 6,604 | 15,734 | |||||||||||
| Non-controlling interest | 4,881 | 1,424 | 358 | 6,663 | ||||||||||||
|
EROS INTERNATIONAL PLC |
|
NOTES TO UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL |
|
(Amounts in thousands, except share and per share data) |
The impact of adoption of IFRS 15 and IFRS 9 on the consolidated interim
statement of income for the nine month ended December 31, 2018 was as
follow.
| December 31, | ||||||||||||||||
| 2018 | ||||||||||||||||
| December 31, | (without | |||||||||||||||
| 2018 | adoption | |||||||||||||||
| (reported) | IFRS 9 | IFRS 15 | of IFRS 9/15) | |||||||||||||
| Revenue | $ | 200,381 | $ |
- |
$ | 17,641 | $ | 218,022 | ||||||||
| Cost of sales | (119,144 | ) |
- |
- |
(119,144 | ) | ||||||||||
| Gross profit | 81,237 | 17,641 | 98,878 | |||||||||||||
| Administrative cost | (49,243 | ) | 9,973 |
- |
(39,270 | ) | ||||||||||
| Operating profit | 31,994 |
9,973 |
17,641 | 59,608 | ||||||||||||
| Financing costs | (16,674 | ) |
- |
- |
(16,674 | ) | ||||||||||
| Finance income | 10,685 | 1,497 | 12,182 | |||||||||||||
| Net finance costs | (5,989 | ) | 1,497 |
- |
(4,492 | ) | ||||||||||
| Other gains/ (losses) | (797 | ) | (14,458 | ) |
- |
(15,255 | ) | |||||||||
| Profit before tax | 25,208 | (2,988 | ) | 17,641 | 39,861 | |||||||||||
| Income tax | (6,808 | ) |
- |
(6,808 | ) | |||||||||||
| Profit for the period | $ | 18,400 | $ | (2,988 | ) | $ | 17,641 | $ | 33,053 | |||||||
| Attributable to: | ||||||||||||||||
| Equity holders of Eros International Plc | 8,571 | (5,326 | ) | 16,386 | 19,631 | |||||||||||
| Non-controlling interest |
9,829 |
2,338 | 1,255 |
13,422 |
||||||||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20190221005491/en/