Moreover, founder and former chairman Subhash Chandra, who stepped down from his position in November but continues to be on board as non-executive director, will not be putting up his name for re-election next financial year. The company’s board will be strengthened by adding independent directors.
On the operational front, the media major said it is confident of recovering dues from Siti Cable and DishTV over 12 months and 24 months, respectively. Further, as a business optimisation measure, the company may shut down its linear business in some of the international geographies, especially in Asia, but have presence in these markets through its over-the-top platform, Zee5.
Commenting on D-Street concerns over the past few months on management continuity and the board structure, Goenka said he would continue to work for the company as long as the shareholders want. The promoters now own around 5 per cent stake in ZEEL.
He added that the board has appointed a reputed human resources consultant to review the salary and compensation structure of Goenka, in line with the global best practices.
does not foresee any significant management changes in the near term.
Speaking on the board structure, Goenka said he would remain the sole representative of the promoter family to the board of the company and Chandra would not be putting up his name for re-election in the next financial year and would assume the role of chairman emeritus.
Days after selling stake in Zee, Chandra had stepped down as chairman of the company, but continues to be the non-executive director on ZEEL’s board.
Goenka also noted he is no longer involved in the Essel Group’s corporate affairs and is only dealing with ZEEL.
“To further strengthen the board, new independent board members — with expertise in either media or technology — would be inducted. This exercise is expected to be concluded by February. All these appointments would have to be ratified by shareholders and would come up for their consideration in the upcoming annual general meeting,” said Goenka.
Three directors had stepped down from ZEEL board during the December quarter, citing displeasure over related party transactions.
Goenka added that over the past couple of years, the company has received investor feedback on ZEEL’s treasury policy. “The management has incorporated these changes to the treasury policy and the same has been approved by the board. In a nutshell, it mandates that the entire surplus cash would be invested in high quality and highly liquid instruments,” Goenka told investors.
The internal audit committee had undertaken an audit of the advances during the year and its report has confirmed compliance with all the processes, claimed ZEEL. “These transactions are being further verified by an external auditor and the report would be presented to the board in February,” clarified Goenka.
Goenka also said that ZEEL has done a detailed analysis of recoverability of dues from Siti Cable and DishTV. Based on the assessment, the company has determined that the entire balance is collectible. “According to the plan entered into with Siti Cable and DishTV, the arrears would be cleared over 12 months and 24 months, respectively. Consequent to a delay in payment, the company has taken an expected credit loss charge of Rs 37.6 crore during the quarter.”
ZEEL had appointed a third party to do a deep dive into the financials of these two companies.
Siti Cable and DishTV have started paying their monthly dues as well the extra amount from the earlier overdue. The overdue amounts will subsequently start reducing from the next financial year. About 20 per cent of the subscription revenue would be from DishTV, while Siti Cable’s would be around 7 per cent of the subscription revenue.
On the operational front, Goenka noted it would be available only through Zee5 in some of the international markets, especially in Asia.
ZEEL’s International subscription revenue has been coming down — from Rs 99.3 crore in Q3 of 2018-19 (FY19) to Rs 82 crore in Q3 of 2019-20 (FY20). International advertising revenue, too, is going downhill — from Rs 90 crore in Q3FY19 to Rs 73.8 crore in Q3FY20.
After promoter shareholding reduces to 5%, Subhash Chandra will not put up his name for re-election as director on board
Punit Goenka to be sole representative of promoter family on board
Goenka to continue as long as shareholders desire; board reviewing his remuneration
Zee to pare its international market presence next fiscal to only Zee5
Board approves plan to recover Rs 750 cr dues from Siti Cable and Dish TV over 12 and 24 months, respectively