Hum Network Limited, one of the profitable media groups of Pakistan, has witnessed a challenging time, recording losses of Rs. 257 million by the end of the first half of the financial year 2018-19.
Hum Network’s revenues from advertisement and production dropped significantly in the period of July to December 2018 compared to the corresponding period of last year. Whereas the expenses under the cost of outsourced, in-house programming and other heads surged in the first half of 2018-19 compared with the previous financial year.
The Network with its major projects this year made huge expenses and investments, transforming it into a loss-making entity from a profitable company.
In 2018, Hum Network launched a news outlet Hum News in Pakistan and UK. It kicked off an e-commerce company, Hum Mart. The expenses of these projected carried forward in the first half of FY19.
The group also released a movie “Parwaaz Hai Junoon” under the banner of Hum Films. Hum Network Limited also organized its famous events in the first half of FY 19 such as Hum Style Awards, Masala Family Festival and Bridal Courter Week.
This was the first time the Network scored losses on its balance sheet for two straight quarters since its launch in 2005. The Network, with its sound financial backing of sponsors and quality of content, attracted handsome business from advertisers and sponsors which put the group on the road of profitability with consistent growth till the last financial year.
The Network crossed Rs. 1 billion profit in the financial year 2016-17, which was the highest ever bottomline of the company. The company is listed at Pakistan Stock Exchange (PSX). It consist of six subsidiaries including Hum TV, Hum Network UK, Hum TV FZ LLC, HUMM Co, Skyline Publications (Newsline) and Hum Mart.
Overall, the revenue decreased to Rs. 2.08 billion in 1HFY19 from Rs. 2.43 billion reported in FY18. The Network’s overall cost of production and transmission increased to Rs. 1.88 billion in 1HFY19 from Rs. 1.475 billion of 1HFY18. The distribution cost also increased to Rs. 174 million from Rs 146 million during the period of comparison.
Earnings per share decreased to Rs. -0.27 from Rs. 0.57.
Currently, Pakistan’s economy is going through a challenging phase. The media industry of the country is going through a tough time with massive layoffs and cost-cutting by the outlets. However, Hum Network continued its expansion plans in the country with different media outlets and different projects.
Comment by Hum Group
In Pakistan, some economic parameters are declining while others remain somewhat stagnant. The situation is worrisome as slow economic growth and increasing fiscal imbalance is preventing the advertisers to publicize their products and services on all accessible ad platforms thus we do not foresee a significant increase in ad revenue.
Despite these uncertain economic conditions, we did our best to maintain our position. The economic conditions may have impacted our revenues but not our viewers.
The network continues to invest in strong content and events. We are confident that our business will thrive with the improvement of geopolitical and economic conditions of Pakistan.